Check My Work A-Z B eBook Problem Walk-Through Stocks A and B have the following probability distributions of expected future returns Probability A 0.1 (7%) (26%) 6 0 0.5 11 18 0.2 22 28 0.1 28 45 a. Calculate the expected rate of return, B. for Stock B(A - 12.60%.) Do not round Intermediate calculations. Round your answer to two decimal places 0.1 b. Calculate the standard deviation of expected returns, on for Stock A ( - 17.79%.) Do not round Intermediate calculations. Round your answer to two decimal places. % Now calculate the coefficient of variation for Stock B. Do not round intermediate calculations. Round your answer to two decimal places 3 Is it possible that most investors might regard Stock B as being less risky than Stock A? 1. If Stock B is more highly correlated with the market than A, then it might have a higher beta than Stock A, and hence be less risky in a portfolio sense IL. If Stock B is more high correlated with the market than A, then it might have a lower beta thar Stock A, and hence be less risky in a portfolio sense III. If Stock B is more highly correlated with the market than A, then it might have the same beta as Stock A, and hence be just as risky in a portfolio sense. IV. If Stock B is less highly correlated with the market than A, then it might have a lower beta than Stock A, and hence be less risky in a portfolio sense V. If Stock B is less highly correlated with the market than A, then it might have a higher beta than Stock A, and hence be more risky in a portfolio sense. IV c. Assume the risk-free rate is 1.5%. What are the Sharpe ratios for Stocks A and B? Do not round intermediate calculations. Round your answers to four decimal places Stock A $ $ Stock