Question: What is the expected return on a portfolio which is invested 20% in stock A and 80% in stock B? State of Probability of Returns
What is the expected return on a portfolio which is invested 20% in stock A and 80% in stock B?
| State of | Probability of | Returns if State Occurs | |
| Economy | State of Economy | Stock A | Stock B |
| Boom | 20% | 18% | 9% |
| Normal | 70% | 11% | 7% |
| Recession | 10% | -10% | 4% |
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