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Consider the following information: Rate of Return if State Occurs State of Economy Probability of State of Economy Stock A Stock B Stock C Boom

Consider the following information:

Rate of Return if State Occurs
State of Economy Probability of State of Economy Stock A Stock B Stock C
Boom 0.64 0.19 0.11 0.21
Bust 0.36 0.13 0.17 -0.03

Requirement 1:

What is the expected return on an equally weighted portfolio of these three stocks? (Do not round your intermediate calculations.)

(Click to select) 14.12% 14.83% 13.41% 10.40% 14.68%

Requirement 2:

What is the variance of a portfolio invested 10 percent each in A and B and 80 percent in C? (Do not round your intermediate calculations.)

(Click to select) 0.008493 0.012005 0.008918 0.008069 0.009247

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