Question: Consider the following information: State Probability ABC, Inc. Return XYZ, Inc. Return Boom .25 0.18 0.27 Normal .50 0.10 0.18 Slowdown .10 0.08 0.06 Recession

Consider the following information:

State Probability ABC, Inc. Return XYZ, Inc. Return

Boom .25 0.18 0.27

Normal .50 0.10 0.18

Slowdown .10 0.08 0.06

Recession .15 -0.02 -0.12

For both ABC and XYZ, answer the following. Upload the Excel file.

a) What is the expected return?

b) What is the variance?

c) What is the standard deviation?

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