Business, 23.12.2020 04:00 ruslffdr

Consider the following information on returns and probabilities: Invest 1/2 of your money in Asset A and 1/2 in Asset B. State Probability A B Boom .25 12% 4% Bust .75 6% 18% What is the expected return for the portfolio

Answers

Answer from: heatherballiet866

11%

Explanation:

Find the expected return in both Booms and Busts;

0.5 of your money is in Asset A and Asset B each.

Boom;

= (0.50 * 12%) + (0.50 * 4%)

= 8%

Bust

= (0.50 * 6%) + (0.50 * 18%)

= 12%

Portfolio expected return = (0.25 * 8%) + (0.75 * 12%)

= 11%

Answer from: Quest

the definition of a small business is an independently owned and operated company that is limited in size and in revenue depending on the industry. a local bakery that employs 10 people is an example of a small business. a manufacturing facility that employees less than 500 people is an example of a small business.

Answer from: Quest

4.94.. let me know if i'm correct

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Consider the following information on returns and probabilities: Invest 1/2 of your money in Asset A...