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Ben has $80,000 to invest and chooses to allocate his money among only Stocks P and Q. He invests three times as much in Stock

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Ben has $80,000 to invest and chooses to allocate his money among only Stocks P and Q. He invests three times as much in Stock P as compared to his investments in Stock Q. What is the standard deviation of the returns of his portfolio? State of Economy Probability of State of Economy Return if State Occurs Stock P Stock Q Boom 25% 11% 5% Normal 45% 8% 6% Recession 25% -5% 8% Depression 5% -45% 12%

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