Table 1

Stock Market	Probability	Return A	Return B
Good	25	7%	5%
Average	30	10%	8%
Bad	40	-15%	-9%

4) Can you make proper rate of return calculation using table 1? Why or why not?

Table 2

Stock Market	Probability	Return A	Return B
Good	25	7%	5%
Average	35	10%	8%
Bad	40	-15%	-9%

a ) What is the return expected for Return A. Show formula and calculation.

b ) What is the return expected for Return B. Show formula and calculation.

c ) Determine the risk for Returns A & B. Show formula and calculations for both returns.