You decide to invest in a portfolio consisting of 23 percent Stock X, 44 percent Stock...

You decide to invest in a portfolio consisting of 23 percent Stock X, 44 percent Stock Y, and the remainder in Stock Z. Based on the following information, what is the standard deviation of your portfolio?

State of Economy	Probability of State		Return if State Occurs
	of Economy		Return if State Occurs
	of Economy		Stock X		Stock Y		Stock Z
Normal		.82		11.30%		4.70%		13.70%
Boom		.18		18.60%		26.60%		18.10%

Multiple Choice

1.80%
4.90%
6.13%
2.41%
7.15%

Expert Solution

jeff jeffy answered 1 year ago

You decide to invest in a portfolio consisting of 33 percent Stock A, 44 percent Stock...

You decide to invest in a portfolio consisting of 33 percent Stock A, 44 percent Stock B, and the remainder in Stock C. Based on the following information, what is the variance of your portfolio? State of Economy Probability of State Return if State Occurs of Economy Stock A Stock B Stock C Recession .111 − 9.80% − 3.20% − 12.20% Normal .659 9.10% 10.60% 16.60% Boom .230 21.49% 24.99% 29.69% rev: 04_25_2019_QC_CS-167128 .00803 .01084 .00747 .00843 .00907

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You decide to invest in a portfolio consisting of 13 percent Stock X, 52 percent Stock...

You decide to invest in a portfolio consisting of 13 percent Stock X, 52 percent Stock Y, and the remainder in Stock Z. Based on the following information, what is the standard deviation of your portfolio? State of Economy Probability of State Return if State Occurs of Economy Stock X Stock Y Stock Z Normal .75 10.60% 4.00% 13.00% Boom .25 17.90% 25.90% 17.40% Multiple Choice 8.76% 3.61% 7.51% 6.01% 2.71%

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You decide to invest in a portfolio consisting of 32 percent Stock A, 46 percent Stock...

You decide to invest in a portfolio consisting of 32 percent Stock A, 46 percent Stock B, and the remainder in Stock C. Based on the following information, what is the variance of your portfolio? State of Economy Probability of State Return if State Occurs of Economy Stock A Stock B Stock C Recession .113 − 10.00% − 3.40% − 12.40% Normal .663 9.30% 10.64% 16.80% Boom .224 21.53% 25.07% 29.77% rev: 04_25_2019_QC_CS-167128 Multiple Choice .01088 .00846 .00806 .00910 .00749

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