3.What is the standard deviation of a portfolio which is comprised of $9,000 invested in stock S and $6,000 in stock T? The standard deviation of returns of Stock S is 10% and that of Stock T is 8%. The correlation coefficient of returns of the two stocks is 0.20.

a. 7.34%

b. 9.20%

c. 9.00%

d. 5.39%

e. Can not be determined

State of Economy Boom Normal Recession Probability of State of Economy 5 85% 10% Returns if State Occurs Stocks Stock T 11 5 8 6 -5 8