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

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Consider the following information about three stocks: Rate of Return if State Occurs Stock State of Economy Boom Normal Bust Probability of State of Economy 20 50 Stock A 38 21 Stock B -50 16 28 54 13 45 30 .05 a-1.If your portfolio is invested 35 percent each in A and B and 30 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.) 2- What is the variance? (Do not round intermediate calculations and round your 2. answer to 5 decimal places, e.g., 16161.) - What is the standard deviation? (Do not round intermediate calculations and enter 3. your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. If the expected T-bill rate is 4.70 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 4.20 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.) - What are the approximate and exact expected real risk premiums on the portfolio? 2. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e..., 32.16.) 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 risk premium % % a de 96 9 96 De la 96

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