State of Economy Prob of State of Economy Rate of Return if State Occurs Stock A Stock B Stock c Recession 0.72 0.1 0.4 0.4 Boom 0.28 0.29 0.35 -0.2 What is the expected return on an equally weighted portfolio of these three stocks? What is the variance of a portfolio invested 27% each in A and B and 46 % in C? %