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Problem 11-10 Returns and Standard Deviations [LO 1, 2] Consider the following information: ...

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Finance

Problem 11-10 Returns and Standard Deviations [LO 1, 2]

Consider the following information:

State of Probability of Rate of Return If State Occurs
Economy State of Economy Stock A Stock B Stock C
Boom .19 .360 .460 .340
Good .41 .130 .110 .180
Poor .31 .020 .030 ? .066
Bust .09 ? .120 ? .260 ? .100

Your portfolio is invested 30 percent each in A and C and 40 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return % What is the variance of this portfolio? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., 32.16161.) Variance What is the standard deviation of this portfolio? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Standard deviation %

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