Question: Explain the problem of unknown risks for financial instruments in furthering the 2007-2009 financial crisis. b. Stocks offer an expected return of 20%, with a

  1. Explain the problem of unknown risks for financial instruments in furthering the 2007-2009 financial crisis.
  2. b. Stocks offer an expected return of 20%, with a standard deviation 22%. Silver offers an expected return of 12% with a standard deviation of 30%. In light of the apparent inferiority of silver with respect to both mean return and volatility, why would anyone hold silver?

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