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1. Consider the following information on returns and probabilities: Invest 1/2 of your money in Asset A and 1/2 in Asset B. State Probability Boom

1. Consider the following information on returns and probabilities: Invest 1/2 of your money in Asset A and 1/2 in Asset B. State Probability Boom .25 A B 12% 4% Bust .75 6% 18% What is the expected return for the portfolio? what is the standard deviation of the return on the portfolio? If you invested 100% in stock A, the standard deviation of this investment is

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