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Consider the following two stocks. Probabilities (Pi) Stock A Stock B Recession 9% 10% P1 = 27% P2 = 35% 16% Normal Boom |-2% 24%
Consider the following two stocks. Probabilities (Pi) Stock "A" Stock "B" Recession 9% 10% P1 = 27% P2 = 35% 16% Normal Boom |-2% 24% P3 = 38% (17% The portfolio weights for stocks "A" and "B" are 0.1 and 0.9, respectively. What are the expected returns of stock "A" and "B"? Enter your answers as a percentage. Do not put the percent sign in your answers. Round your answers to 2 DECIMAL PLACES. Era) = Number Erb) = Number
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