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You decide to invest in a portfolio consisting of 27 percent Stock A, 38 percent Stock B, and the remainder in Stock C. Based on
You decide to invest in a portfolio consisting of 27 percent Stock A, 38 percent Stock B, and the remainder in Stock C. Based on the following information, what is the variance of your portfolio?
\begin{tabular}{lcccc} State of & Probability of & \multicolumn{3}{c}{ Return if State Occurs } \\ Economy & State Economy & Stock A & Stock B & Stock C \\ Recession & .105 & 9.20% & 2.60% & 11.60% \\ Normal & .647 & 8.50% & 10.48% & 16.00% \\ Boom & .248 & 21.37% & 24.75% & 29.45% \end{tabular}Step by Step Solution
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