Question: 2 3 You are considering two stocks: 4 4 5 Return Probability of the Return 6 Stock 7 ABC 25% 8 17% 15% 12% 50%

2 3 You are considering two stocks: 4 4 5 Return Probability of the Return 6 Stock 7 ABC 25% 8 17% 15% 12% 50% 9 25% XYZ 10% 10 11 23% 19% 60% 14% 30% 12 13 14 Part A: What is the expected return on each stock? 15 16 17 18 Part B: Which stock is riskier and why? 19

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