Problem 1 (45 marks)

You have done your research for the following investments and your friend has provided their expectations for the markets for next year.

State of Economy	Probability of State of Economy	Stock A	Stock B	TSX
Boom	.30	30%	-9%	18%
Normal	.40	16%	12%	10%
Recession	.30	-10%	20%	-10%

m. Using an excel spreadsheet and the calculations you have done above, prepare a spreadsheet that provides the expected returns and the risk for a portfolio that invests in stock A and stock B. Prepare the calculations using 4% increments in the weights. (10 marks)

Please look up for the question on chegg to get all the calculations done to put it in the spreadsheet on excel .