Question: Security Returns If State Occurs State of Economy Probability of State of Economy Roll Ross Bust .30 19 % 20 % Boom .70 30 7
| Security Returns If State Occurs | |||||||||||
| State of Economy | Probability of State of Economy | ||||||||||
| Roll | Ross | ||||||||||
| Bust | .30 | 19 | % | 20 | % | ||||||
| Boom | .70 | 30 | 7 | ||||||||
| Calculate the standard deviations for Roll and Ross by filling in the following table (verify your answer using returns expressed in percentages as well as decimals): (Negative values should be indicated by a minus sign. Do not round intermediate calculations. Round your Standard deviation answers to 2 decimal places and other answers to 4 decimal places. Omit the "%" sign in your response.) |
| State of Economy | Probability of State of Economy | Return Deviation from Expected Return | Squared Return Deviation | Product | |||||||
| Roll | |||||||||||
| Bust | .30 | ||||||||||
| Boom | .70 | ||||||||||
| 2 = | |||||||||||
| Ross | |||||||||||
| Bust | .30 | ||||||||||
| Boom | .70 | ||||||||||
| 2 = | |||||||||||
| Standard Deviations | |
| Roll | % |
| Ross | % |
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