Question 5 (2 marks): Consider the following information: State of Economy Recession Stable Boom Probability 0.2 0.6 0.2 Stock A 8% 13% 25% Stock B 12% 10% 8% a) What is expected return of stock A and stock B? b) What is standard deviation of stock A and stock B? Based on expected return and standard deviation, which stock should be invested and why? c) You have a $12,000 po olio which is invested in stocks A and B ($4,000 invested in stock A and 8,000 invested in stock B). What is the portfolio's expected return und standard deviation? d) Compare portfolio's expected return and standard deviation with those of individual stock A and B and give comments