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Problem 11-16 Scenario Analysis (LO3) The common stock of Escapist Films sells for $25 a share and offers the following payoffs next year: The common
Problem 11-16 Scenario Analysis (LO3) The common stock of Escapist Films sells for $25 a share and offers the following payoffs next year: The common stock of Leaning Tower of Pita Inc. is selling for $80 and offers these payoffs next year: Required: a-1. Calculate the rate of return of Escapist Films for each economic state. a-2. Calculate the expected return and standard deviation of Escapist if all three economic scenarios are equally likely to occur. b-1. Calculate the rate of return of a portfolio half invested in Escapist and half in Leaning Tower of Pita for each economic state. b-2. Calculate the expected rate of return and standard deviation of a portfolio half invested in Escapist and half in Leaning Tower of Pita. All three economic scenarios are equally likely to occur. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Calculate the expected rate of return and standard deviation of a portfolio half invested in Escapist and half in Leaning Tower of Pita. All three economic scenarios are equally likely to occur. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
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