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		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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Expert Solution

jeff jeffy answered 1 year ago

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