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Compute the expected return on a and expected return on b

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Reference no: EM132583836

The following data are given for an investor that needs to invest 100,000 of which br 40,000 are on stock A and Br 60000 on stock B. Additional data related to the two stocks Are presented as follow

state probability       return on A     return on B

30%,                          0.4                  0.20
20%,                            0.3,               -0.10
10%                             0.25                  0.30

Question 1: Based on these compute the following

A. Expected return on A

B. Expected return on B

C. Expected return on portfolio

Reference no: EM132583836

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