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Consider the following information: State of the Probability of economy state of economy Boom 0.2 Growth 0.3 Normal 0.3 Recession 0.2 Return on A (%)
Consider the following information: State of the Probability of economy state of economy Boom 0.2 Growth 0.3 Normal 0.3 Recession 0.2 Return on A (%) 10 -2 20 15 Return on B (%) 5 0 15 20 What is the expected return for A? For B?|| b. What is the standard deviation for A? For B? c. What is the expected return and variance of a portfolio that is 50 per cent invested in A and 50 per cent in B
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