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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