Consider the following information on a portfolio of three stocks:

State of Economy Probability of State Occurring Rate of Return

Stock A $(\%)$ Stock B $(\%)$ Stock C $(\%)$

Boom $\mathrm{.}0571528$

Normal $\mathrm{.}8091217$

Bust $\mathrm{.}1510235$

The portfolio is invested $40$ percent in each Stock A and Stock C and $20$ percent in Stock B$.$ If the expected T$-$bill rate is $4\mathrm{.}03$ percent, what is the expected risk premium on the portfolio?

Multiple Choice

$5\mathrm{.}38\%$

$6\mathrm{.}90\%$

$5\mathrm{.}62\%$

$7\mathrm{.}68\%$

$6\mathrm{.}72\%$