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State Of Economy Probability Of State Returns   Stock Q Stock R Boom 10% 14%   16% Normal...

State Of Economy Probability Of State Returns   Stock Q Stock R

Boom 10% 14%   16%

Normal 90%   8% 11%

1. What is the expected return of Stock Q? What is the expected return of Stock R?

2. What is the Standard Deviation of Stock R?

3. What is the expected return of the portfolio if you invest $1,800 in Stock Q and $1,200 in Stock R?

4. What is the Standard Deviation of the Portfolio based on investing $1,800 in Stock Q and $1,200 in Stock R?

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