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Based on the following information, calculate the expected return, variance and standard deviation: State of the Economy Probability Rate of Return Depression 5% -5.0% Recession
Based on the following information, calculate the expected return, variance and standard deviation:
State of the Economy | Probability | Rate of Return |
Depression | 5% | -5.0% |
Recession | 10% | 4.0% |
Normal | 60% | 8.0% |
Boom | 25% | 12.0% |
Input area: | Output area: | |||||||||
Adj. | Ret. Dev. | |||||||||
State | Prob. | Stock A | Stock A | Probability | Return | Ret. | Ret. Dev. | Squared | Variance | |
Depression | Depression | |||||||||
Recession | Recession | |||||||||
Normal | Normal | |||||||||
Boom | Boom | |||||||||
E(R) = | ||||||||||
Standard Deviation |
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