Question: An analyst has estimated how a particular stocks return will vary depending on what will happen to the economy. What is the coefficient of variation

An analyst has estimated how a particular stocks return will vary depending on what will happen to the economy. What is the coefficient of variation on the company's stock?

OF THE ECONOMY PROBABILITY OF STATE OCCURRING

STOCK'S EXPECTED RATE IF THIS STATE OCCURS

Recession

Below Average

Average

Above Average

Boom

.10

.20

.40

.20

.10

(.60)

(.10)

.15

.40

.90

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