10. Returns and Standard Deviations [LO1] Considerthe following information:Rate of Return IfState Occurs StateEconomyof Probability of State Stock Stock StockCof EconomyBВoom.10.2735.16.40Good.60.17.08Рoor.25-.01-.03-.04Bust.05-.12-.18-.09453a. Your portfolio is invested 30 percent each in A and C, and40 percent in B. What is the expected return of the portfolio?b. What is the variance of this portfolio? The standarddeviation?

Here, Weight of Stock A is 30% Weight of Stock B is 40% Weight of Stock C is 30%

State Economy of Probability of State Stock Stock Stock of Economy A в с Вoom .10 35 .40 .27 .08 Good .60 .16 .17 Рoor .25 -.01 -.03 -.04 Bust .05 -.12 -.18 -.09 a. Your portfolio is invested 30 percent each in A and C, and 40 percent in B. What is the expected return of the portfolio? b. What is the variance of this portfolio? The standard deviation?

State Economy of Probability of State Stock Stock Stock of Economy A в с Вoom .10 35 .40 .27 .08 Good .60 .16 .17 Рoor .25 -.01 -.03 -.04 Bust .05 -.12 -.18 -.09 a. Your portfolio is invested 30 percent each in A and C, and 40 percent in B. What is the expected return of the portfolio? b. What is the variance of this portfolio? The standard deviation?

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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