Market Condition Probability of Occurrence 0.20 0.35 Strong Normal Weak 0.45 Blue Llama Mining 27.5% 16.5% -22% Hungry Whale Electronics 38.5% 22% -27.5% Calculate expected returns for the individual stocks in Juan's portfolio as well as the expected rate of return of the entire portfolio over the three possible market conditions next year. The expected rate of return on Blue Llama Mining's stock over the next year is The expected rate of return on Hungry Whale Electronics's stock over the next year is The expected rate of return on Juan's portfolio over the next year is The expected returns for Juan's portfolio were calculated based on three possible conditions in the market. Such conditions will vary from time to time, and for each condition there will be a specific outcome. These probabilities and outcomes can be represented in the form of a continuous probability distribution graph. For example, the continuous probability distributions of rates of return on stocks for two different companies are shown on the following

Juan owrs a two-stock portfolio that invests in Blue Lama Mining Compary (BLM) and Hungry Whale Electronics (HWE). Three-quarters Each stock's expected return for the next year will depend on forecosted market conditions. The expected returns from the stocics in dfferent market condions afe detailed in the following table: Caicuiate expected tefurns for the indridual atocks in Jusn's portfolio as weil is the expected rate of return of the entire portfolio over the three possible maket cond vone nextreas. Based on the grophis information, atich of the following statements is true? Camoany what lower nek. Compary th has lower nst