Expected return and standard deviation. Use the following information to answer the questions:a. What is the expected return of each asset?b. What is the variance and the standard deviation of each asset?c. What is the expected return of a portfolio with 12% in asset J, 52% in asset K, and 36% in asset L?d. What is the portfolio's variance and standard deviation using the same asset weights from part (c)?Hint: Make sure to round all intermediateanswers you will type.a. What is the expected return of asset J?(Round to four decimal places.)Data table(Click on the following icon in order to copy its contents into a spreadsheet.)Return onAsset J inState ofEconomyBoomGrowthStagnantRecessionProbabilityof State0.240.360.210.19State0.0500.0500.0500.050Return onAsset K inState0.2300.1200.020-0.060Return onAsset L inState0.2500.1900.065- 0.190

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a. What is the expected return of each asset? b. What is the variance and the standard deviation of each asset? c. What is the expected return of a portfolio with 12% in asset J, 52% in asset K, and 36% in asset L? d. What is the portfolio's variance and standard deviation using the same asset weights from part (c)?

a. What is the expected return of each asset? b. What is the variance and the standard deviation of each asset? c. What is the expected return of a portfolio with 12% in asset J, 52% in asset K, and 36% in asset L? d. What is the portfolio's variance and standard deviation using the same asset weights from part (c)?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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