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A financial analyst covering Magnum Oil has determined the following four possible returns given four different states of the economy over the next period. Probability

A financial analyst covering Magnum Oil has determined the following four possible returns given four different states of the economy over the next period.

Probability Return
0.10 -.20
0.25 -.05
0.40 0.15
0.25 0.30

Calculate the expected return and standard deviation for Magnum Oil.

A.

E(R)=5.00% and E(SD)=26%

B.

E(R)=10.25% and E(SD)=16%

C.

E(R)=7.5% and E(SD)=20%

D.

E(R)=10.25% and E(SD)=26%

E.

E(R)=5.00% and E(SD)=16%

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