Question: Practice Assignment #7 26. Use the data given below to answer questions 26 & 27: Economic Condition Stock A Stock B Probability Very good Good

Practice Assignment #7

26. Use the data given below to answer questions 26 & 27: Economic Condition Stock A Stock B Probability Very good Good Poor 50% 25% 30% 15% 10% 0.25 0.6 0.15 -10% Calculate the expected return on the portfolio formed by investing 40% of the funds in Stock A and 60% in Stock B: a. 20% b. 21.2% C. 9.5% d. 23% e. None of the given answers 27. Calculate the standard deviation of returns on the portfolio formed by investing 40% of the funds in Stock A and 60% in Stock B: (approximately) a. 11.35% b. 13.1% c. 9.5% d. 23% e. None of the given answers

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