Problem $11-13$ Scenario Analysis $($LO$2)$

Consider the following scenario analysis:

a$.$ Is it reasonable to assume that Treasury bonds will provide higher returns in recessions than in booms?

Yes

No

b$.$ Calculate the expected rate of return and standard deviation for each investment. $($Do not round

intermediate calculations. Enter your answers as a percent rounded to $1$ decimal place.$)$

c$.$ Which investment would you prefer?