Consider the following information on two stocks: P(State) Stock A Stock B 20% 30% 20% 50% 12% -5% 15% 4% 8% Recession 15% -10% 10% Boom Normal Slow $Investment Beta $35,000 1.45 0.85 Asset A Asset B $15,000 Calculate the variance of the portfolio. (Enter percentages as decimals and round to 4 decimals)
Consider the following information on two stocks: P(State) Stock A Stock B 20% 30% 20% 50% 12% -5% 15% 4% 8% Recession 15% -10% 10% Boom Normal Slow $Investment Beta $35,000 1.45 0.85 Asset A Asset B $15,000 Calculate the variance of the portfolio. (Enter percentages as decimals and round to 4 decimals)
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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![Consider the following information on two stocks:
P(State) Stock A Stock B
20% 30%
20%
50%
12%
-5%
15%
4%
8%
Recession 15%
-10%
10%
Boom
Normal
Slow
$Investment
Beta
1.45
0.85
Asset A $35,000
Asset B $15,000
Calculate the variance of the portfolio. (Enter percentages as decimals and round to 4 decimals)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7027a34f-2fe8-411c-976f-66458773ba91%2Ff6408475-cc0b-49ba-af93-b017de6ac3cb%2Fqrx4iu_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Consider the following information on two stocks:
P(State) Stock A Stock B
20% 30%
20%
50%
12%
-5%
15%
4%
8%
Recession 15%
-10%
10%
Boom
Normal
Slow
$Investment
Beta
1.45
0.85
Asset A $35,000
Asset B $15,000
Calculate the variance of the portfolio. (Enter percentages as decimals and round to 4 decimals)
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