Question: Problem 11-10 Returns and Standard Deviations [LO 1, 2] Consider the following information: Rate of Return If State Occurs State of Probability of Economy State

Problem 11-10 Returns and Standard Deviations [LO 1, 2] Consider the following information: Rate of Return If State Occurs State of Probability of Economy State of Economy Stock A Stock B Stock C Boom .19 .366 .466 .346 Good .41 .136 .116 .186 Poor .31 .026 .036 .091 Bust .09 .126 .266 .106 Requirement 1: Your portfolio is invested 31 percent each in A and C and 38 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) Expected return of the portfolio % Requirement 2: (a) What is the variance of this portfolio? (Do not round intermediate calculations. Round your answer to 5 decimal places (e.g., 32.16161).) Variance of the portfolio (b) What is the standard deviation of this portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) Standard deviation %

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