Problem 11-8 Returns and Standard Deviations Consider the following information: Rate of Return if State Occurs State of Probability of Economy State of Economy Boom .60 Bust .40 Stock A .15 .18 Stock B .23 .08 Stock C .42 -.09 a. What is the expected return on an equally weighted portfolio of these three stocks? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the variance of a portfolio invested 24 percent each in A and B and 52 percent in C? (Do not round intermediate calculations and round your answer to 6 decimal places, e.g., .161616.) % a. Expected return b. Variance Prev Next >