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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
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 | .36 | .46 | .26 | ||||||||||||
Good | .55 | .20 | .17 | .11 | ||||||||||||
Poor | .20 | .04 | .07 | .06 | ||||||||||||
Bust | .05 | .14 | .32 | .09 | ||||||||||||
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a. | Your portfolio is invested 26 percent each in A and C, and 48 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
b-1. | What is the variance of this portfolio? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., .16161.) |
b-2. | What is the standard deviation? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
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