All answers must be entered as a formula in excel

1.Consider the following information. Your portfolio is invested 30 percent each in A and C, and 40 percent in B. What is the expected return of the portfolio? What is the variance of the portfolio? The standard deviation?

StateProbabilityStock AStock BStock C

Boom0.100.350.450.27

Good0.600.160.100.08

Poor0.25(0.01)(0.06)(0.04)

Bust0.05(0.12)(0.20)(0.09)

Weights0.300.400.30

Complete the following analysis. Do not hard code values in your calculations.

PortfolioReturn Squared

StateReturn ProductDeviationDeviationProduct

Boom

Good

Poor

Bust______________________

E(R)=Variance=

Standard Deviation=