Question: Consider the table below and answer the preceding questions State of economy Return on stock A Return on stock B Probability of return Recession 5%

Consider the table below and answer the preceding questions

State of economy

Return on stock A

Return on stock B

Probability of return

Recession

5%

-1%

0.3

Normal

10%

5%

0.5

Prosperity

15%

20%

0.4

Calculate

A. The expected return of stock A and B

B. The standard deviation of stock a and B

C. Coefficient of variation of stock A and B

D. Which stock is risky?

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