$25\%$ chance recession $50\%$ normal $25\%$Boom$!$ The investor compares returns for stock A and B $$ A$$ B Recession$5\%-2\%$ Norm$1015$ Boom$2030$ Find the expected return for A and B$.$ Find standard deviation. $$ A rj r rj$-$r $($rj$-$r$)^2$ pj totals Recession $$ Normal $$ Boom $$ $$ B rj r rj$-$r $($rj$-$r$)^2$ pj totals Recession $$ Normal $$ Boom $$ $$ If an investor puts $25\%$ in stock A with an expected return of $15\%$ and $75\%$ in stock B with an expected return of $10\%,$ find the expected return on the portfolio. $$ If an investor puts $30\%$ in stock A with an expected return of $20\%$ and $70\%$ in stock B with an expected return of $12\%,$ find the expected return on the portfolio. $75\%$ of a portfolio is invested in A$,25\%$ in B$,$ the standard deviation of A is $10\%,$ the standard deviation of B is $15\%,$ the correlation coefficient of AB is $+0\mathrm{.}5.$ If Company A has a beta of $1\mathrm{.}25,$ the risk free rate of return is $1\%,$ and the expected return on the market is $12\%,$ calculate CAPM. $$ If Company B has a beta of $\mathrm{.}95,$ the risk free rate of return is $2\%,$ and the expected return on the market is $11\%,$ calculate CAPM. $$