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Answer questions 6 to 10, based on the following information about the returns of stock stock B. State 1 2 Probability (P₁) a. 8% 0.2 0.8 6. The Expected return of Stock A is: b. 9% 7. The Expected return of Stock B is: b. 8% b. 9% c. 12% c. 12% d. 13% 8. The Standard deviation of the returns of Stock A is: a. 2.4% b. 4.0% c. 3.2% RAI 20% 10% d. 6% Rai 5% 15% d. 5.2%

Answer questions 6 to 10, based on the following information about the returns of stock stock B. State 1 2 Probability (P₁) a. 8% 0.2 0.8 6. The Expected return of Stock A is: b. 9% 7. The Expected return of Stock B is: b. 8% b. 9% c. 12% c. 12% d. 13% 8. The Standard deviation of the returns of Stock A is: a. 2.4% b. 4.0% c. 3.2% RAI 20% 10% d. 6% Rai 5% 15% d. 5.2%

Essentials Of Investments
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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Answer questions 6 to 10, based on the following information about the returns of stock A and stock B. State 2 Probability (Pi) 0.2 0.8 6. The Expected return of Stock A is: a. 8% b. 9% 7. The Expected return of Stock B is: b. 8% b. 9% c. 12% c. 12% d. 13% 8. The Standard deviation of the returns of Stock A is: a. 2.4% b. 4.0% c. 3.2% RAI 20% 10% d. 6% RBi 5% 15% d. 5.2% 9. Assuming an investment of 75% in stock A and 25% in stock B, the expected return of the portfolio is: a. 12.25% b. 8.5% c. 12.75% d. 8.25%. c. 2.00% 10. Assuming an investment of 75% in stock A and 25% in stock B, the standard deviation of the portfolio is: a. 3.06% b. 4.15% d. 3.94%
Transcribed Image Text:Answer questions 6 to 10, based on the following information about the returns of stock A and stock B. State 2 Probability (Pi) 0.2 0.8 6. The Expected return of Stock A is: a. 8% b. 9% 7. The Expected return of Stock B is: b. 8% b. 9% c. 12% c. 12% d. 13% 8. The Standard deviation of the returns of Stock A is: a. 2.4% b. 4.0% c. 3.2% RAI 20% 10% d. 6% RBi 5% 15% d. 5.2% 9. Assuming an investment of 75% in stock A and 25% in stock B, the expected return of the portfolio is: a. 12.25% b. 8.5% c. 12.75% d. 8.25%. c. 2.00% 10. Assuming an investment of 75% in stock A and 25% in stock B, the standard deviation of the portfolio is: a. 3.06% b. 4.15% d. 3.94%
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