Question: Calculate the expected return and standard deviation for the following single stock: State of economy Probability of state of economy Return if state of economy
Calculate the expected return and standard deviation for the following single stock:
| State of economy | Probability of state of economy | Return if state of economy occurs |
| Recession | .15 | .02 |
| Normal | .25 | .08 |
| Boom | .60 | .12 |
The expected return and standard deviation, respectively, are:
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
