Compute expected return and standard deviation of portfolio


The stock of Business Adventures sells for $25 a share. Its likely dividend payout and end-of-year price depend on the state of the economy by the end of the year as follows:

Dividend Stock Price
Boom $1.50 $35
Normal economy 1.10 30
Recession .55 21

Calculate the expected return and standard deviation of a portfolio invested half in Business Adventures and half in Treasury Bills. The return on bills is 3%.

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Basic Statistics: Compute expected return and standard deviation of portfolio
Reference No:- TGS097589

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