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		.60			.09			.18			.36
Bust		.40			.15			.07			.05

a.	What is the expected return on an equally weighted portfolio of these three stocks? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Expected return

%

b.	What is the variance of a portfolio invested 15 percent each in A and B and 70 percent in C? (Do not round intermediate calculations and round your answer to 6 decimal places, e.g., 32.161616.)

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		.15			.33			.43			.34
Good		.50			.20			.14			.08
Poor		.30			.01			.09			.03
Bust		.05			.17			.29			.10

a.	Your portfolio is invested 32 percent each in A and C, and 36 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculaitons. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Expected return

%

b-1	What is the variance of this portfolio? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., 32.16161.)

Variance

b-2	What is the standard deviation? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Standard deviation

%

Variance