Question
Barbara is considering investing in a company's stock and is aware that the return on that investment is particularly sensitive to how the economy is
Barbara is considering investing in a company's stock and is aware that the return on that investment is particularly sensitive to how the economy is performing. Her analysis suggests that four states of the economy can affect the return on the investment. Probability Return Boom 0.3 25.00% Good 0.3 15.00% Level 0.2 10.00% Slump 0.2 -5.00% Use the table of returns and probabilities above, to determine the expected return on Barbaras investment? (Round answer to 3 decimal places, e.g. 0.076.) Expected return Use the table of returns and probabilities above, to determine the standard deviation of the return on Barbara's investment? (Round intermediate calculations and final answer to 5 decimal places, e.g. 0.07680.) Standard deviation
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