1. Suppose you have $20,000 total. If you put $14,000 in Stock A and the remainder in Stock B, what will be the expected return on your portfolio?

   State of Economy	Probability	Return on A	Return on B
   Recession	0.2	-20%	30%
   Normal	0.5	10%	20%
   Boom	0.3	70%	50%

   a.	24.70%
   b.	28.50%
   c.	14.50%
   d.	10.90%

QUESTION 8

1. Following Question 7, what will be the standard deviation on your portfolio?

   a.	18.01%
   b.	20.75%
   c.	24.32%
   d.	26.61%