a) you have invested 20 per cent of your portfolio in Alpha Ltd. 50 per cent in Bravo Co, and the rest of your portfolio investment Is in Charlie Resources. Calculate the expected return of your portfolio if Alpha, Bravo, and Charlie have expected returns of 5% p.a.. 18% p.a. and 25% p.a., respectively.

b) you are thinking about investing your money in stock A. You know that the economy is expected to behave according to the following table. You believe the likelihood of each scenario is identical( all states of the economy have equal probabilities).

State of the economy Returns

Depression -35%

Recession 15%

Normal 30%

Boom 50%

1- Calculate the expected returns for stock A.

2- Calculate the standard deviation of stock A returns.