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Use the following information to answer the two questions below. State of Prob. of the Rate of return if state occurs the economy. state of

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Use the following information to answer the two questions below. State of Prob. of the Rate of return if state occurs the economy. state of economy. Stock A Stock B Boom 0.75 15% 4% Bust 0.25 5% 4% You MUST use 4 digits in every calculation you do in order for your answer to be the same as the one in the system. Enter answer using 4 decimals. Do not use or enter in %. For example, if your answer is 3.48% enter 0.035; if your answer is 0.12013 then enter 0.1201 What is the expected return of a portfolio with 80% in asset A and 20% in Asset B? A/ What is the standard deviation of the portfolio with 80% in asset A and 20% in Asset B? AM

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