TABLE 5-7 There Are Two Houses with Almost Identical Characteristics Available for Available

question 39

Short Answer

TABLE 5-7
There are two houses with almost identical characteristics available for investment in two different neighborhoods with drastically different demographic composition. The anticipated gain in value when the houses are sold in 10 years has the following probability distribution:

-Referring to Table 5-7, if you can invest 70% of your money on the house in neighborhood A and the remaining on the house in neighborhood B, what is the portfolio expected return of your investment?

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