Consider the following information:

		Rate of Return If State Occurs
State of	Probability of
Economy	State of Economy	Stock A	Stock B
Recession	.20	.05	.20
Normal	.55	.14	.14
Boom	.25	.16	.34

a.	Calculate the expected return for the two stocks. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)

Expected return for A	%
Expected return for B	%

b.	Calculate the standard deviation for the two stocks. (Do not round your intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)

Standard deviation for A	%
Standard deviation for B	%

Consider the following information:

		Rate of Return if State Occurs
State of	Probability of
Economy	State of Economy	Stock A	Stock B	Stock C
Boom	.20	.18	.45	.23
Good	.15	.16	.18	.13
Poor	.40	.05	.15	.02
Bust	.25	.15	.35	.11

a.	Your portfolio is invested 20 percent each in A and C, and 60 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)

Expected return

%

b-1.	What is the variance of this portfolio? (Do not round intermediate calculations. Round your answer to 5 decimal places.)

Variance of this portfolio

b-2.	What is the standard deviation? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

Standard deviation

%