Please answer all parts (a-d) with explanations thx.

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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Question
Please answer all parts (a-d) with explanations thx.
z/Test
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 8% in asset J, 51% in asset K, and 41% 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 intermediate calculations to at least seven (7) decimal places. The input instructions, phrases in parenthesis after each answe
apply for the answers you will type.
Data Table
(Click on the following icon in order to copy its contents into a spreadsheet.)
Return on
Return on
Asset K in
State
Return on
State of
Economy
Probability
of State
Asset J in
Asset L in
State
0.280
State
Boom
0.28
0.070
0.070
0.070
0.220
Growth
0.39
0.140
0.200
Stagnant
Recession
0.22
0.065
0.075
0.11
0.070
-0.120
- 0.220
888
2
6
8
Q
T
Y
F
A
S
D
G
J
K
V
Alt
Alt
PrtSc
SINE
,ט א
寸
*の
Transcribed Image Text:z/Test 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 8% in asset J, 51% in asset K, and 41% 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 intermediate calculations to at least seven (7) decimal places. The input instructions, phrases in parenthesis after each answe apply for the answers you will type. Data Table (Click on the following icon in order to copy its contents into a spreadsheet.) Return on Return on Asset K in State Return on State of Economy Probability of State Asset J in Asset L in State 0.280 State Boom 0.28 0.070 0.070 0.070 0.220 Growth 0.39 0.140 0.200 Stagnant Recession 0.22 0.065 0.075 0.11 0.070 -0.120 - 0.220 888 2 6 8 Q T Y F A S D G J K V Alt Alt PrtSc SINE ,ט א 寸 *の
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