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There are two assets and three states of the economy Suppose you have $20,000 total. If you put $15,000 in Stock A and the remainder
There are two assets and three states of the economy
Suppose you have $20,000 total. If you put $15,000 in Stock A and the remainder in Stock B, what will be the standard deviation of your portfolio? 2 decimals for final answer
\begin{tabular}{|l|l|l|l|} \multirow{2}{*}{ State of Economy } & \multirow{2}{*}{\begin{tabular}{l} Probability of State \\ of Economy \end{tabular}} & \multicolumn{2}{|l}{ Rate of Return If State Occurs } \\ \cline { 3 - 4 } & & Stock A & Stock B \\ \hline Recession & .30 & -.20 & .10 \\ \hline Normal & .50 & .40 & .30 \\ \hline Boom & .20 & .80 & .50 \end{tabular}Step by Step Solution
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