Weights 0.30 0.40 0.30 State Prob Stock A Stock B Stock C Portfolio Avg Boom 0.20 2% 18% 20% Normal 0.55 6% 8% 8% Bust 0.25 11% -10% -2% Avg Return StdDev (Risk) Weighted Average of Indidual Stocks StdDev
Weights 0.30 0.40 0.30 State Prob Stock A Stock B Stock C Portfolio Avg Boom 0.20 2% 18% 20% Normal 0.55 6% 8% 8% Bust 0.25 11% -10% -2% Avg Return StdDev (Risk) Weighted Average of Indidual Stocks StdDev
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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Transcribed Image Text:Weights
0.30
0.40
0.30
State
Prob
Stock A
Stock B
Stock C
Portfolio Avg
Boom
0.20
2%
18%
20%
Normal
0.55
6%
8%
8%
Bust
0.25
11%
-10%
-2%
Avg Return
StdDev (Risk)
Weighted Average of Indidual
Stocks StdDev
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