Question
39) A stock has the following probability distribution: If economy is good (the probability is 25%), its expected stock return is 20%; if economy is
39) A stock has the following probability distribution: If economy is good (the probability is 25%), its expected stock return is 20%; if economy is on average (the probability is 50%), its expected stock return is 10%; if economy is bad (the probability is 25%), its expected return is -20%. Find the expected rate of return for the stock ______ 40) Using the data from Question 39, find the standard deviation (risk) for Hamilton's stock 41) Using the results from Question 39 and 40, compute the ratio of the standard deviation to the expected return for the stock______
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