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Probability of the state of economy Rate of return if state occurs Stock T Recession 0.3 2 % Boom 0.7 12 % If you want

Probability of the state of economy

Rate of return if state occurs

Stock T

Recession

0.3

2 %

Boom

0.7

12 %

If you want an expected return of 6%, when holding a portfolio invested in stock T and risk free asset. (The expected return on risk free asset is 2%.) What percentage of stock T should you hold? Express you answer as percent.

could you answer this in 40 minutes? thanks very much! I leave a like

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