We estimate that there will be two states if the economy, boom and bust, in the next
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We estimate that there will be two states if the economy, boom and bust, in the next period, with probability of 30% and 70%, respectively. We also estimate that the return on stock A will be 50% in the boom state and -10% in the bust state. What is the standard deviation of the returns os stock A?
Related Book For
Introduction to Probability
ISBN: 978-0716771098
1st edition
Authors: Mark Daniel Ward, Ellen Gundlach
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