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Assume a retirement portfolio with $1 million invested in bond (50%) and equity (50%). (15 pts) Economy Probability Equity Bond Portfolio Bear Market 0.4 15%
Assume a retirement portfolio with $1 million invested in bond (50%) and equity (50%). (15 pts)
| Economy | Probability | Equity | Bond | Portfolio |
| Bear Market | 0.4 | 15% | 10% | |
| Bull Market | 0.6 | 20% | 0% |
A) What is the portfolio return in each state of economy?
B) What is the portfolio standard deviation?
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Financial Management Concepts and Applications
Authors: Stephen Foerster
1st edition
013293664X, 978-0132936644
