Question: a. What is the expected return on an equally weighted portfolio of these three stocks? b. What is the variance of a portfolio invested 25

a. What is the expected return on an equally weighted portfolio

a.

What is the expected return on an equally weighted portfolio of these three stocks?

b.

What is the variance of a portfolio invested 25 percent each in A and B and 50 percent in C?

Rate of Return If State Occurs State of Probability of Economy State of Economy Boom Bust Stock B Stock C -24 -.08 Stock A 09 10 17 .05 60 40

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