What Is the Standard Deviation of the Returns on a Portfolio

question 25

Multiple Choice

What is the standard deviation of the returns on a portfolio that is invested in Stocks A, B, and C? Twenty percent of the portfolio is invested in Stock A and 35 percent is invested in Stock C.  $$\begin{array} { l ccccc } { \text { State of } } & { \text { Probability of } } &&\text { Rate of Return }\\\text { Economy } & \text { State of Economy } & &{ \text { if State Occurs } } \\& & \text { Stock A } & \text { Stock B } & \text { Stock C } \\\text { Boom } & .04 & .17& .09 & .09 \\\text { Normal } & .81 & .08& .06 & .08 \\\text { Bust } &.15& - .24& - .02& -.13\end{array}$$

---

Definitions:

Interpersonal Relationships

The connections and interactions between two or more people which can involve emotional, social, and professional dynamics.

Lifestyle Dichotomy

The division or contrast between two different ways of living, especially between personal values and societal expectations.

Myers-Briggs Type Indicator

An assessment tool designed to identify a person's psychological type based on Carl Jung's theory of psychological traits.

Judging (J)

A personality trait characterized by a preference for organization, planning, and decision-making in a methodical manner.