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10) You have a portfolio which is comprised of 70 percent of stock A and 30 percent of stock B. What is the expected return on this portfolio?
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10) You have a portfolio which is comprised of 70 percent of stock A and 30 percent of stock
B. What is the expected return on this portfolio? State of the Economy Probability E(R) A E01) B
Weight 70% 30%
Boom 0.2 20% 14%
Normal 0.6 12% 8%
Recession 0.2 -8% 5% A) 11.79 percent
B) 9.30 percent C) 9.58 percent
D) 12.40 percent E) 10.03 percent

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Subject: Business, Finance

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