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1. Risk and return (7 points). The stock of Hawkeye Corporation (HC) currently trades for $100. One year from now the stock price is either
1. Risk and return (7 points). The stock of Hawkeye Corporation (HC) currently trades for $100. One year from now the stock price is either $75 with a 35% chance, $100 with a 10% chance, or $120 with a 55% chance. Determine the three possible end-of-year returns and then find expected return, variance and volatility of HC stock
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