13a)

You are going to make a portfolio consisting of 70 % of Lloyds of London Stock and 30 % of Tencent Stock. You also have the following information:

State i	Probability of State i	LofL Return	Tencent Return
Boom	50 %	23 %	10 %
Bust	50 %	-10 %	56 %

What is the expected return for the portfolio? (Answer as a percentage and Round to 2 decimals)

Answer:

13b)

Consider the following information:

State i	Probability of State i	Actual Return of Google
Boom	69 %	23 %
Bust	31 %	4 %

What is the expected Return on Google Stock? (Answer as a percentage and Round to 2 decimals)

Answer: