Financial management (please give a correct answer without using chat gpt) Using the information contained in the
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Financial management (please give a correct answer without using chat gpt)
Using the information contained in the table below, answer the questions in the issue.
| Probability associated with each state | Rate yield of title A | Rate yield of title B | |
| Period of recession | 0.3 | -15% | 20% |
| Period normal | 0.1 | 20% | 30% |
| Period of prosperity | ? | 60% | 40% |
1. What are the expected returns and standard deviations of securities A and B?
2. Let's assume you have a total of $400,000. If you invest $100,000 in stock B and the rest in stock A.
a) What would be the expected return on the portfolio?
b) Determine the standard deviation of the portfolio.
Expert Answer:
Answer To calculate the expected returns and standard deviations of securities A and B we can use th... View the full answer
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