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a.) What is the portfolio return if you invest equally in Stocks A and B? b.) What is the correlation between Stocks A and B?

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a.) What is the portfolio return if you invest equally in Stocks A and B?

b.) What is the correlation between Stocks A and B? Using BA II Plus?

c.) What is the portfolio standard deviation if you invest equally in Stocks A and B?

Boom v. Normal v. Recession Use the information from the following table to answer the next three questions Probability Stock A Stock B Boom 1/3 12.5% -10.45% Normal 1/3 15.8% 4.52% 1/3 -2.5% 3.85% Recession Average Return Standard Deviation (0) 8.6% -0.6933% 7.9637% 6.9044%

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