Question: ASSIGNMENT 2 1. The following table shows the one-year return distribution of Startup, Inc. Probability 40% 20% 20% 10% 10% Return -100%-75%-50%-25% 1000% Calculate a.

 ASSIGNMENT 2 1. The following table shows the one-year return distribution

ASSIGNMENT 2 1. The following table shows the one-year return distribution of Startup, Inc. Probability 40% 20% 20% 10% 10% Return -100%-75%-50%-25% 1000% Calculate a. The expected return. b. The standard deviation of the return. 2. The figure below shows the one-year return distribution for RCS stock. 35 30 25 20 15 10 -25% -10% 0% 10% 25% Return Calculate a. The expected return. b. The standard deviation of the return 3. Characterize the difference between the two stocks in Problems 1 (Startup) and 2 RCS). What trade-offs would you face in choosing one to hold

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