Question: answer the question all Problem 13-23 Portfolio Returns and Deviations (LO1, 2) Consider the following information about three stocks: State of Economy Boom Normal Bust

 answer the question all Problem 13-23 Portfolio Returns and Deviations (LO1,

2) Consider the following information about three stocks: State of Economy Boom

answer the question all

Problem 13-23 Portfolio Returns and Deviations (LO1, 2) Consider the following information about three stocks: State of Economy Boom Normal Bust Probability of State of Economy 0.20 0.45 0.35 Rate of Return if State Occurs Stock A Stock B Stock C 0.28 0.40 0.56 0.22 0.20 0.18 0.00 -0.20 -0.48 a-1. If your portfolio is invested 30% each in A and B and 40% in C, what is the portfolio expected return? (Do not round intermediate 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 a-3. What is the standard deviation? (Do not round intermediate calculations. Enter the answer as a percent rounded to 2 decimal places.) Standard deviation % b. If the expected T-bill rate is 4.40%, what is the expected risk premium on the portfolio? (Do not round intermediate calculations. Enter the answer as a percent rounded to 2 decimal places.) Expected risk premium % C-1. If the expected inflation rate is 2.40%, what are the approximate and exact expected real returns on the portfolio? (Do not round intermediate calculations. Enter the answers as a percent rounded to 2 decimal places.) % Approximate expected real return Exact expected real return % c-2. What are the approximate and exact expected real risk premiums on the portfolio? (Do not round intermediate calculations. Enter the answers as a percent rounded to 2 decimal places.) % % Approximate expected real risk premium Exact expected real risk premium

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