QUESTION 1 The following information is the probability distribution for the returns of share V and share W. Probability Expected Returns (%) Share V Share W 0.1 0 3 0.2 6 4 0.3 7 5 0.4 5 6 Based on the information above, calculate: (a) Expected returns for each share. (b) Variance for each share. (c) Standard deviation for each share. (d) Covariance between the returns of share V and share W. QUESTION 2: Amin plans to form an investment portfolio that comprised of 40% investment in shane X, 35% investment in share Y and the remaining 25% in share Z. Economic Rate of Return (r) for Shares Situation Probability (P) X Y z Strong 0.48 10% 15% 20% Weak 0.52 10% 6% 1% Calculate: (a) Expected return for each share. (b) Expected return for investment portfolio of share X, Y and Z. (c) Standard deviation for the investment portfolio