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If your portfolio is invested 30 percent each in A and B and 40 percent in...

If your portfolio is invested 30 percent each in A and B and 40 percent in C, what is the portfolio’s expected return and the variance? Show work if possible.

State of Economy

Probability of State of Economy

Stock A Return (%)

Stock B Return

(%)

Stock C Return (%)

Boom

0.10

6%

30%

27%

Normal

0.50

12%

22%

13%

Recession

0.40

18%

-14%

-40%
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