Consider the following information about three stocks: Probability of State of Economy State of Rate of...

Transcribed Image Text:

Consider the following information about three stocks: Probability of State of Economy State of Rate of Return if State Occurs Economy Boom Normal Stock A Stock B Stock C 0.22 0.30 0.42 0.58 0.19 0.46 0.23 0.21 Bust 0.32 0.01 -0.22 -0.50 a-1. If your portfolio is invested 25% each in A and B and 50% in C, what is the portfolio expected return? (Do not round inter calculations. Enter the answer as a percent rounded to 2 decimal places.) Portfolio expected return a-2. What is the variance? (Do not round intermediate calculations. Round the final answer to 8 decimal places.) Variance Consider the following information about three stocks: Probability of State of Economy State of Rate of Return if State Occurs Economy Boom Normal Stock A Stock B Stock C 0.22 0.30 0.42 0.58 0.19 0.46 0.23 0.21 Bust 0.32 0.01 -0.22 -0.50 a-1. If your portfolio is invested 25% each in A and B and 50% in C, what is the portfolio expected return? (Do not round inter calculations. Enter the answer as a percent rounded to 2 decimal places.) Portfolio expected return a-2. What is the variance? (Do not round intermediate calculations. Round the final answer to 8 decimal places.) Variance

Answer rating: 100% (QA)

Formula A D E F Rate of return if state occures State of Econo... View the full answer