This document contains questions about calculating expected return and risk for stock portfolios. It asks to calculate the expected return and standard deviation for General Foods for 1999 based on given probability and return data. It also asks to calculate the expected return of portfolios consisting of 4 securities under different weighting conditions: with 25% weighting for each security, 10% for A and equal remaining weights, and 10% each for A and B and 40% each for C and D.

1. Chapter 7
Expected Return and Risk

2. Question 1
 Calculate the expected return and risk
(standard deviation) for General Foods for
1999, given the following information:
Probabilities 0.15 0.20 0.40 0.10 0.15
Expected Returns 0.20 0.16 0.12 0.05 -0.05

3. Question 2
 Four securities have following expected returns:
 Calculate the expected returns for a portfolio
consisting of all four securities under the
following conditions:
a. The portfolio weights are 25 percent each
b. The portfolio weights are 10 percent in A, with
the remainder equally divided among the other
three stocks.
c. The portfolio weights are 10 percent each in A
and B, and 40 percent each in C and D.
A = 15% B = 12% C = 30% D = 22%