Using the probability distribution shown below, calculate the expected risk and return estimates of a portfolio comprised of 50% of Stock X and 50% of Stock Y. State of Probability of Stock X's Stock Y's conditional conditional economy state occuring return return Recession 20% -10% 20% Normal 50% 10% 12% Boom 30% 22% -8% The portfolio has an expected return of 8.6% and a standard deviation of 2.50%. B. The portfolio has an expected return of 8.6% and a standard deviation of 2.66%. C. The portfolio has an expected return of 8.6% and a standard deviation of 6.24%. D. The portfolio has an expected return of 7.67% and a standard deviation of 7.09%. QUESTION 3 5 points Save Answer Using the same information from Question 2, how will you choose between Stock Y and the portfolio (50% Stock X + 50% Stock Y)? It depends. Neither is strictly better. Although Stock Y has a higher expected return, the portfolio has a lower standard deviation. B. Stock Y is a better investment, since Stock Y has a higher lower standard deviation. The portfolio is a better investment, since the portfolio has a higher expected return and a lower standard deviation. D. Stock Y is a better investment, since Stock Y has a higher expected return