State Of Economy Probability Stk A Stk B Stk C
Of State of Econ.
Boom .65 .08 .02 .33
Bust .35 .14 .24 -.06
a) What is the explained return on an equally weighted portfolio of these three stocks?
b) What is the varianceof a portfolio invested 20 percent each in A and B and 40 percent in C?
Provides steps necessary to determine returns and standard deviation.