Question: What is the difference between the variances for large- and small-company stocks using the following table? States of the Economy Probability of the State 3-Month

What is the difference between the variances for large- and small-company stocks using the following table?

States of the Economy Probability of the State 3-Month T-Bill Large- Company Stock Small- Company Stock
Boom 0.3 4 10 30
Steady 0.5 4 5 20
Recession 0.2 4 0 10

a)

 40.25%

b)

 36.75%

c)

 27.30%

d)

 14.90%

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