The standard deviation of the returns on a portfolio that is invested 37 percent is 1.66 percent
This is further explained below.
Generally,
E. 3.41 percent
E(r)Boom = (0.37 *0.14) + (.0.48* 0.16) = 0.1286
E(r)Normal = (0.37 *0.08) + (0.48 0.11) = 0.0824
E(r)Portfolio = (0.10 * 0.1286) + (0.90 *0.0824) = 0.08702
VarPortfolio = [0.10 (0.1286 - 0.08702)2] + [0.90 (0.0824 - 0.08702)2] = 0.000
Std dev = 0.000274 = 1.66 percent
In conclusion,
Std dev = 0.000274 = 1.66 percent
Read more about standard deviation
https://brainly.com/question/16555520
#SPJ4
CQ
What is the standard deviation of the returns on a portfolio that is invested 37 percent in stock Q and 48 percent in stock R?
state probability return
Q R
boom 10% 14% 16%
normal 90% 8% 11%