pare to Q 8.16. Multiply each rate of return for M by 2.0. This portfolio offers -6%, +6%, +10%, and +22%. Compute the expected rate of return and standard deviation of this new portfolio M? Poll to those of the original Exhibit 8.1: Rates of Return on Five Investment Assets. There are only four possible future scenarios, S1 through S4, each equally likely and indicated with a card suit. There are only 5 available investments (M, A, B, C, and F). (These could themselves be portfolios, of course.) The variance (Var) and standard deviation (Sdv ) were explained in Section 6.1. The middle figure is a traditional" histogram of M. The bottom figure contains the "condensed" histograms for all 5 assets. Table note [a]: We use the "%%' notation only for variance computations. Just like '%' means 'divide by 100', %%' means 'divide by 100 and then divide by 100 again', i.e., 'divide by 10,000'. This makes it easy to see that (5%)2 + (5%)2 + (5%)2 + (5%)2 is (25%%+ 25%% + 25%%+ 25%% = 100%%) = 10%. If you find it easier to read (0.0025 +0.0025 +0.0025 +0.0025 = 0.01) = 10%, then be my guest and use this notation instead. The answers are always the same