problem 1

Suppose you have a project that has a 0.7 chance of tripling your investment in a year and a 0.3 chance of doubling your investment in a year. What is the standard deviation of the rate of return on this investment?(Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places.)

problem 2

You manage a risky portfolio with an expected rate of return of 21% and a standard deviation of 32%. The T-bill rate is 8%. Your client chooses to invest 65% of a portfolio in your fund and 35% in a T-bill money market fund.

Suppose that your risky portfolio includes the following investments in the given proportions:

Stock A27%Stock B36%Stock C37%

What are the investment proportions of your client's overall portfolio, including the position in T-bills?(Round your answers to 1 decimal place.)

problem 3

You manage a risky portfolio with an expected rate of return of 22%and a standard deviation of 35%. The T-bill rate is 6%.

Your client chooses to invest 75% of a portfolio in your fund and 25% in an essentially risk-free money market fund. What are the expected return and standard deviation of the rate of return on his portfolio?(Do not round intermediate calculations. Round "Standard deviation" to 2 decimal places