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Consider the following information about three stocks: Rate of Return If State Occurs Stock A Stock C State of Economy Boom Normal Bust Probability of

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Consider the following information about three stocks: Rate of Return If State Occurs Stock A Stock C State of Economy Boom Normal Bust Probability of State of Economy .20 .45 .35 20 .18 .02 Stock B 32 16 -34 .54 14 -42 a-1. If your portfolio is invested 40 percent each in A and B and 20 percent in C, what is the portfolio expected return? (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a-2. What is the variance? (Do not round Intermediate calculations and round your answer to 5 decimal places, e.g., 16161.) a-3. What is the standard deviation? (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. If the expected T-bill rate is 3.80 percent, what is the expected risk premium on the portfolio? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) C-1. If the expected inflation rate is 3.40 percent, what are the approximate and exact expected real returns on the portfolio? (Do not round Intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) c-2. What are the approximate and exact expected real risk premiums on the portfolio? (Do not round Intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Print c-1. If the expected inflation rate is 3.40 percent, what are the approximate and exa expected real retums on the portfolio? (Do not round intermediate calculation and enter your answers as a percent rounded to 2 decimal places, e.g, 32.16 c-2. What are the approximate and exact expected real risk premiums on the portfol (Do not round Intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e-9., 32.16.) eferences % a-1. Portfolio expected return a-2. Variance a-3. Standard deviation b. Expected risk premium C-1. Approximate expected real return Exact expected real return c-2. Approximate expected real risk premium Exact expected real tisk premium % % % %

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