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State of the economy Probability Stock P Stock Q Boom .7 32% 18% Recession .3 -14% -5% a. What is the expected return of Stock

State of the economy Probability Stock P Stock Q Boom .7 32% 18% Recession .3 -14% -5% a. What is the expected return of Stock P? b. What is the expected return of Stock Q? c. What is the expected return of a portfolio 60 percent invested in Stock P and the remainder in Stock Q? d. What is the standard deviation of a portfolio 60 percent invested in Stock P and the remainder in Stock Q?

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