Suppose financial analysts believe that there are four equally likely states of the economy: depression, recession, normal, and boom. The returns on the supertech company are expected to follow the economy closely, while the return on the slowpoke company are not. The return predictions are as follows:

States of the economy	Allos Inc. Returns (Ra)	Orangus Inc. Returns Rb
Depression	-20%	5%
Recession	10%	20%
Normal	30%	-12%
Boom	50%	9%

Required:

1. For each company calculate:

(i) The expected returns

(ii) The variance

(iii) The standard deviation

2. Assuming you are an investor with Ghc 100 available. If you invest Ghc60 and Ghc40 in Allos Inc. and Orangus Inc. respectively, what will be your portfolio returns?

3. Calculate the standard deviation of the portfolio