Question: Only the last question, others I got answer. 1.Consider the following two stocks. Probabilities (pi) Stock a Stock b Recession p1=29% -8% 6% Normal p2=20%

Only the last question, others I got answer.

1.Consider the following two stocks.

Probabilities (pi) Stock "a" Stock "b"

Recession p1=29% -8% 6%

Normal p2=20% 10% -13%

Boom p3=51% 14% 21%

The portfolio weights for stocks "A" and "B" are 0.25 and 0.75, respectively.

a) What arethe expected returns of stock "A" and "B"? Enter your answer as a percentage

E(ra)=6.82

E(rb)=9.85

b) Using the correct answers from the previous question, what arethe standard deviations of stocks "A" and "B"? Enter your answer as a percentage

SDa=9.59

SDb=13.12

c) Using the correct answers from the previous questions, what is the expected return of the portfolio? Enter your answer as a percentage

E(rp)=9.09

d) Using the correct answers from the previous questions, what is the standard deviation of the portfolio? Enter your answer as a percentage. Do not put the percentage sign in your answer. Round your answer to 2 DECIMAL PLACES.

SDp=

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