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B. J. Gautney Enterprises is evaluating a security. One-year Treasury bills are currently paying 5.5 percent. Calculate the investment's expected return and its standard deviation.

B. J. Gautney Enterprises is evaluating a security. One-year Treasury bills are currently paying 5.5 percent. Calculate the investment's expected return and its standard deviation. Should Gautney invest in this security?

Probability Return

.05 -5%

.45 3%

.45 7%

.05 10%

round to two decimal places

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