Question: Return on Return on State Probability Security A Security B Boom .3 12% -2% Normal .6 8% 2% Bust .1 4% 6% What is the

Return on Return on

State Probability Security A Security B

Boom .3 12% -2%

Normal .6 8% 2%

Bust .1 4% 6%

What is the standard deviation of a portfolio with weights of 60% in security A and the remainder in security B? A. 0.5% B. 0.9% C. 1.5% D. 2.3% E. 6.4%

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