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State of the economy Probability Return on A(%) Return on B(%) Bear 0.4 3 6.5 Bull 0.6 15 6.5 Calculate expected return and standard deviation

State of the economy

Probability

Return on A(%)

Return on B(%)

Bear

0.4

3

6.5

Bull

0.6

15

6.5

Calculate expected return and standard deviation of two securities.

Suppose Miss Maple invested $2,500 in security A and $3,500 in security B. Calculate the expected return and standard deviation of her portfolio.

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