ANSWER QUESTION AT THE BOTTOM OF THE PAGE

An investor is considering the purchase of Gryphon stock, which has returns given in the table below. Rate of Return Scenario Recession Probability 10.12 2% Normal Economy 0.53 0.35 Boom Calculate the expected return and standard deviation of Gryphon. Round your answers to 2 decimal places. Enter your answers below. E(r) = 9.91 Correct response: 9.91 % Std. Dev. = 3.71 Correct response: 3.72+0.01% The investor decides to diversify by investing $9,000 in Gryphon stock and $7,000 in Royal stock, which has an expected return of 10.5% and a standard deviation of 4.9%. The correlation coefficient for the two stocks' returns is 0.7. Calculate the expected return and standard deviation of the portfolio. Round your answers to 2 decimal places. Enter your answers below. E(rp) = 10.17 o Correct response: 10.170.01% Std. Dev. = 3.92 Correct response: 3.9+0.02% Suppose the investor decides to invest an additional $1,500 in a treasury bill yielding 1.5%. What will be the expected return and standard deviation of this portfolio. Round your answers to 2 decimal places. E(rp) = Number Std. Dev. = Number Section Attempt 1 of 1