4. Based on the following information: State of economy Probability of state of economy 33.33% 33.33% 33.33% Recession Normal Boom Rate of return if state occurs Stock B -2% 0% 3% Stock A 7% 10% 15% a) Which investment has the highest expected return? b) Which investment has the highest total risk (standard deviation)? Stock C 5% 11% 20%

4. Based on the following information: a) Which investment has the highest expected return? b) Which investment has the highest total risk (standard deviation)