I need assistance finding the variance and deviation! Consider the following inf

Question

I need assistance finding the variance and deviation!

Consider the following information:

Rate of Return If State Occurs

Requirement 1: Your portfolio is invested 29 percent each in A and C and 42 percent in B.

What is the expected return of the portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

Expected return of the portfolio 11.41 %

Requirement 2: (a) What is the variance of this portfolio? (Do not round intermediate calculations. Round your answer to 5 decimal places (e.g., 32.16161).)

Variance of the portfolio (b)

What is the standard deviation of this portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

Standard deviation %

Rate of Return If State Occurs

State of Probability of Economy State of Economy Stock A Stock B Stock C         Boom .16     .363     .463     .343             Good .44     .133     .113     .183             Poor .34     .023     .033     .075             Bust .06     .123     .263     .103    

Explanation / Answer

1 State of Economy Prob. P R(A) Wt.(A) R*Wt*p-(A) R(B) Wt.(B) R*Wt*p -(B) R© Wt.(C) R*Wt*p-(C) SUM-R*Wt*p-(A+B+C) Boom 0.16 0.363 0.29 0.0168 0.463 0.42 0.0311 0.343 0.29 0.01592 0.0639 Good 0.44 0.133 0.29 0.0170 0.113 0.42 0.0209 0.183 0.29 0.02335 0.0612 Poor 0.34 0.023 0.29 0.0023 0.033 0.42 0.0047 -0.075 0.29 -0.00740 -0.0004 Bust 0.06 -0.123 0.29 -0.0021 -0.263 0.42 -0.0066 -0.103 0.29 -0.00179 -0.0106 TOTAL 0.1141 Expected return of the portfolio = Sum of the probabilities of the weighted returns = 11.41% 2. Variance & Standard Deviation of the PORTFOLIO   State of Economy Prob. P R(A) Deviation from the mean R(A)-0.1141 Dev.^2 Dev^2*p-(A) Prob. P R(B) Deviation from the mean R(B)-0.1141 Dev.^2 Dev^2*p-(B) Prob. P R© Deviation from the mean R(C)-0.1141 Dev.^2 Dev^2*p-(C) VARIANCE of the portfolioSUM DEV.^2*p-(A+B+C) Boom 0.16 0.363 0.2489 0.061951 0.009912 0.16 0.463 0.3489 0.121731 0.019477 0.16 0.343 0.2289 0.052395 0.008383 0.037772 Good 0.44 0.133 0.0189 0.000357 0.000157 0.44 0.113 -0.0011 1.21E-06 5.32E-07 0.44 0.183 0.0689 0.004747 0.002089 0.002246 Poor 0.34 0.023 -0.0911 0.008299 0.002822 0.34 0.033 -0.0811 0.006577 0.002236 0.34 -0.075 -0.1891 0.035759 0.012158 0.017216 Bust 0.06 -0.123 -0.2371 0.056216 0.003373 0.06 -0.263 -0.3771 0.142204 0.008532 0.06 -0.103 -0.2171 0.047132 0.002828 0.014733 Variance 0.071968 Variance of the PORTFOLIO 0.071968 Std. Devn. 0.26827 Std. Dev. Of PORTFOLIO 26.83% 26.83%

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