Use the following table to answer questions 1 - 6:

State of Economy	Probability of State of Economy	Asset A Rate of Return	Asset B Rate of Return
Boom	0.3	0.13	0.08
Normal	0.5	0.06	0.05
Recession	0.2	-0.05	-0.01

1. What is the expected return for asset A?

2. What is the expected return for asset B?

3. What is the standard deviation for asset A?

4. What is the standard deviation for asset B?

5. What is the expected return of a portfolio that has 70% in Asset A and 30% in Asset B?

6. The standard deviation of the 70% A and 30% B portfolio most likely should:

A)	Equal 70% X A's standard deviation plus 30% x B's standard deviation.

B)	Be greater than 70% X A's standard deviation plus 30% x B's standard deviation.

C)	Be less than 70% X A's standard deviation plus 30% x B's standard deviation.