Consider the following information:       Rate of Return if State Occurs State of Probability of State   Economy of Economy Stock A Stock B Stock C   Boom .68               .11         .05         .36          Bust .32               .25         .31         –.16            a. What is the expected return on an equally weighted portfolio of these three stocks?    b. What is the variance of a portfolio invested 23 percent each in A and B and 54 percent in C?

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