2. Statistical measures of standalone risk Remember, the expected value of a probability distribution is a statistical measure of the average (mean) value expected to occur during all possible circumstances. To compute an asset's expected return under a range of possible circumstances (or states of nature), multiply the anticipated return expected to result durino each state of nature by its probability of occurrence. Consider the following case: Juan owns a two-stock portfollo that invests in Celestial Crane Cosmetics Company (CCC) and Lumbering Ox Truckmakers (LoT). Three. quarters of Juan's pertfolio value consists of CCCSshares, and the balance consists of LOT's shares. Each-stocks expected teturn for the noxt year wil depend on forecasted market conditions. The expected rehurns from the stocks in different market conditions are detailed in the following table: posible madict condtions neat Veat Calculate expected returns for the individual stocks in Juan's portfolio as well as the expected rate of return of the entire portfolio over the three possible market condikions nevt year. - The expected rate of retam on Celestial Crane Cosmetics's stock over the next year is - The expected rate of returm on Lumbering Ox Truckmakers's stock over the next vesr is. - The copected rate of ceturn on Juan's portlolio over the neat year is The expected returns for Juan's portfolio were calculated based on three possible conditions in the market. 5 uch conditions will vary from time to time, and for ench condition there will be a specific outcome. These srobabintes and outcomes can be represented in the form of a conbinucus probubility eased on the graph s intormation, which of the following statements is true Companr a has lomar ris