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Consider the following information 3. Consider the following information: Return Return State of Probability Return Economy of State of on on on Economy Stock Stock

Consider the following information

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3. Consider the following information: Return Return State of Probability Return Economy of State of on on on Economy Stock Stock Stock 0.50 0.06 0.16 Boom 0.33 0.02 0.14 Bust 0.50 0.06 a. What is the expected return on an equally weighted portfolio of the three stocks? b. What is the variance of a portfolio invested 20 percent each in A and B, and 60 percent in C

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