Question 6:

It is the expected component of news that affects a stock's price and therefore its return.

Group of answer choices

False

True

Question 7

Use the following information on returns and probabilities of Asset P and Asset Q for the next THREE questions.

Assume there are only two states of economy: Boom and Recession

State	Probability	P	Q
Boom	.80	20%	25%
Recession	.20	6%	8%

The expected return of P is ____________%.

Group of answer choices

19.6

17.2

15.4

16.8

18.6

Question 8

The expected return of Q is ____________%.

Group of answer choices

20.6

17.8

19.4

21.6

18.2

Question 9

What is the expected return (%) for a portfolio with an investment of $7,000 in Asset P and $3,000 in Asset Q?

The expected return is ______%.

Round-off to 1 decimal place. E.g., if 12.18%, input your answer as 12.2, NOT 0.1.