What is the nominal annual rate of return

Question 1: Here are the expected returns on two stocks:

Returns
Probability    X Y
0.1    -20% 10%
0.8    20 15
0.1    40 20

If you form a 50-50 portfolio of the two stocks, what is the portfolio's standard deviation?

a.    16.5%
b.    10.5%
c.    13.4%
d.    8.1%
e.    20.0%

Question 2: A share of preferred stock pays a quarterly dividend of $1.00. If the price of the stock is $50, what is the nominal (not effective) annual rate of return?

a.    8.0%
b.    8.5%
c.    10.0%
d.    9.0%
e.    9.5%

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