3. What would be the expected return of the portfolio if 40% was invested in XYZ? (1 mark)

Express answer as a decimal to 4 decimal places

AutoSave OFF w Question - Saved to my Mac Q- Search in Document Home Insert Draw Design Layout References Mailings Review View Share Calibri (Body) 12 A- A A A 1 AaBbCcDdEe AaBbccddee AaBbcc AaBbccddee AaBbc Aabb Cedd Ee AgBbCcDdEe AaBbCcDdEe Paste BIU Uabe Xx2 A A Normal No Spacing Heading 1 Heading 2 Title Subtitle Subtle Emph... Emphasis Styles Pane Office Update To keep up-to-date with security updates, fixes, and improvements, choose Check for Updates. Check for Updates The Classy Clothing Company is considering an investment in the following two stocks. They have been able to determine their expected returns based on the expected different states of the economy. State of Economy ABC Company Probability XYZ Company Expected Return Expected Return Very Good Good 20% 9% 0.25 0.25 0.25 0.25 25% 14% 10% -2% Average Poor 7% 4% 10% Expected Return Variance 11.75% 0.009319 Page 1 of 1 72 words X English (Australia) O Focus ES + + 106%