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3. Statisticalmeasures of standalone risk Suppose Maria owns a two-stock portfolio that invests in Falcon...

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3. Statisticalmeasures of standalone risk Suppose Maria owns a two-stock portfolio that invests in Falcon Freight Company (FF) and Pheasant Pharmaceuticals (PP). Three-quarters of Marta's portfolio value consists of Falcon Freight's shares, and the remaining balance consists of Pheasant Pharmaceuticals's shares. Each stock's expected return for the next year will depend on forecasted market conditions. The expected returns from the stocks in different market conditions are detailed in the following tables Market Condition Strong Normal Probability of Expected Returns Occurrence FF PP 50% 20% 28% 25% 12% 16% Week 25 -16% -20% Calculate the expected returns for the individual stocks in Maria's portfolio as well as the expected rate of return of the entire portfolio over the three possible market conditions next year . The expected rate of return on Falcon Freight's stock over the next year is The expected rate of return on Pheasant Pharmaceuticals's stock over the next year is The expected rate of return on Maria's portfolio over the next year is

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