Suppose you invest $10,000 in Stock 1, and $15,000 into Stock 2.

State Prob(S) Stock 1 Stock 2

Boom 20% 0.18 -0.05

Normal 45% 0.06 0.15

Bust 15% -0.09 0.03

1) Calculate the weight of Stock 1 in the portfolio (4 decimals).

2) Calculate the expected return of the portfolio (4 decimals).

3) Calculate the variance of the portfolio (4 decimals).

4) Calculate the standard deviation of the portfolio (4 decimals).