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Consider the following information: Rate of Return if State Occurs State of Economy Boom Bust Probability of State of Economy 0.64 0.36 Stock A 0.21

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Consider the following information: Rate of Return if State Occurs State of Economy Boom Bust Probability of State of Economy 0.64 0.36 Stock A 0.21 0.17 Stock B Stock C 0.25 0.09 0.11 -0.05 a. What is the expected return on an equally weighted portfolio of these three stocks? b. What is the variance of a portfolio invested 30 percent each in A and B and 40 percent in C

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