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9. Value 1.00 points Problem 11-17 Portfolio Analysis (LO3) Scenario Recession Normal economy Boom Probability 20 60 20 Rate of Return Stocks Bonds -5% +14%

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9. Value 1.00 points Problem 11-17 Portfolio Analysis (LO3) Scenario Recession Normal economy Boom Probability 20 60 20 Rate of Return Stocks Bonds -5% +14% +15 *B +25 -4 Consider a portfolio with weights of .60 in stocks and .40 in bonds. 2. What is the rate of return on the portfolio in each scenario? (Do not round intermediate calculations. Enter your answers as a percent rounded to 1 decimal place.) Rate of Return % Scenario Recession Normal economy Boom % b. What are the expected rate of return and standard deviation of the portfolio? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Expected rate of return Standard deviation What is the expected rate of return and standard deviation on an all-stock portfolio? An all-bond portfolio? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Expected rate of return Standard deviation 100% stock: % % 100% bond % %

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