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7) You are considering investing in the following stock X. State of the Economy Recession Below Average Average Above Average Boom Probability 10% 16% 51%

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7) You are considering investing in the following stock X. State of the Economy Recession Below Average Average Above Average Boom Probability 10% 16% 51% 14% 9% Stock x Return - 75% -10% 15% 33% 82% a) Calculate the expected return of the stock. b) Calculate the standard deviation (riskiness) of returns for this stock. c) You are also looking into Stock Y which has the same expected return as Stock X, but a higher standard deviation. Which stock would you invest in and why

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