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Consider the following two stocks. Probabilities (Pi) Stock B Stock A -3% Recession 18% P1 = 38% P2 = 26% Normal 7% | -11% Boom
Consider the following two stocks. Probabilities (Pi) Stock "B" Stock "A" -3% Recession 18% P1 = 38% P2 = 26% Normal 7% | -11% Boom P3 = 36% 18% |27% The portfolio weights for stocks "A" and "B" are 0.2 and 0.8, 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. E(ra) = 7.16 Correct response: 7.16+0.01 E (r6) = 9.9 Correct response: 9.9+0.01 Click "Verify" to proceed to the next part of the question. This questions has 4 parts (i.e., you will be clicking "Verify" 4 times) What are the standard deviations of stocks "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. SDa= Number SDb ; Number Click "Verify" to proceed to the next part of the question. Section Attempt 1 of 1 Verify
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