Consider the following information: Rate of Return if State Occurs State of Probability of State Economy...
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Consider the following information: Rate of Return if State Occurs State of Probability of State Economy of Economy Boom 30 Stock A .20 Stock B Stock C .44 .31 Good .30 .13 .20 .13 Poor .20 .03 -.09 -.05 Bust .20 -.05 -.28 -.09 a. Your portfolio is invested 15 percent each in Stocks A and C and 70 percent in Stock B. What is the expected return of the portfolio? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Expected return % b-1. What is the variance of this portfolio? (Do not round intermediate calculations. Round your answer to 5 decimal places.) Variance b-2. What is the standard deviation? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Standard deviation % Consider the following information: Rate of Return if State Occurs State of Probability of State Economy of Economy Boom 30 Stock A .20 Stock B Stock C .44 .31 Good .30 .13 .20 .13 Poor .20 .03 -.09 -.05 Bust .20 -.05 -.28 -.09 a. Your portfolio is invested 15 percent each in Stocks A and C and 70 percent in Stock B. What is the expected return of the portfolio? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Expected return % b-1. What is the variance of this portfolio? (Do not round intermediate calculations. Round your answer to 5 decimal places.) Variance b-2. What is the standard deviation? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Standard deviation %
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Answer rating: 100% (QA)
a To find the expected return of the portfolio we need to calculate the weighted average of the retu... View the full answer
Related Book For
Corporate Finance Core Principles and Applications
ISBN: 978-1259289903
5th edition
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan
Posted Date:
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