Consider the following information: State of Economy Probability of State of Economy Rate of Return if State
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Question:
Consider the following information: |
State of Economy | Probability of State of Economy | Rate of Return if State Occurs | |
---|---|---|---|
Stock A | Stock B | ||
Recession | .21 | .09 | .16 |
Normal | .51 | .12 | .13 |
Boom | .28 | .17 | .30 |
a. | Calculate the expected return for Stocks A and B. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) |
b. | Calculate the standard deviation for Stocks A and B. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) |
Related Book For
Corporate Finance Core Principles and Applications
ISBN: 978-1259289903
5th edition
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan
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