Consider the following information on a portfolio of three stocks.

1. If your portfolio is invested 30% in A and B and 40% in C, what is the

portfolio expected return?

variance?

standard deviation?

2. If the expected T-bill rate is 5.25%, what is the expected risk premium on the portfolio?

If the expected inflation rate is 5%, what is the expected real return on the portfolio? What is the expected real risk premium on the portfolio?