Question: Excel is not allowed. Please use financial calculator or normal calculator Thank you 5. Use the following information to answer the questions below. We also

Excel is not allowed. Please use financial calculator or normal calculator Thank you  Excel is not allowed. Please use financial calculator or normal calculator

5. Use the following information to answer the questions below. We also know that the market risk premium is 8% and the risk free rate is 4%. State of economy Probability of state Stock B return Stock A return 24% Boom 30% 20% Normal 50% 12% 18% Recession 20% 4% -10% (a) [7 points] Which stock is riskier in terms of total risk of returns? Support your answer by relevant calculations. (b) [6 points] Which stock is riskier in terms of systematic risk of returns? Support your answer by relevant calculations. Assume that both stocks are on the security market line. (c) [7 points] If you already have a fully-diversified portfolio, according to the systematic risk principle, which stock would be a better addition for you to have low risk for your portfolio? Explain your

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