*** Below the table it states, "Consider a portfolio with weights of .6 in stocks and .4 in bonds." ***

Scenario Recession Normal economy Boom Probability .20 .50 .30 Rate of Return Stocks Bonds -8% +19% +20 +25 +6 +10 Consider a portfolio with weights of .6 in stocks and .4 in bonds. a. What is the rate of return on the portfolio in each scenario? (Do not round intermediate calculations. Round your answers to 1 decimal place.) Rate of Return Scenario Recession Normal economy Boom b. What are the expected rate of return and standard deviation of the portfolio? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Expected rate of return Standard deviation % D7% c. Which investment would you prefer? Portfolio Bonds Stocks