Question
Based on the following information: State of Economy Probability of State of the Economy Rate of return if State Occurs. Stock A Rate of return
Based on the following information:
State of Economy | Probability of State of the Economy | Rate of return if State Occurs. Stock A | Rate of return of state occurs Stock B |
Recession | .2 | .8 | -.15 |
Normal | .5 | .11 | .14 |
Boom | .3 | .16 | .31 |
Calculate the expected return for the two stocks. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
Expected return Stock A: ___%
Expected return Stock B: ___%
Calculate the standard deviation for the two stocks. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Standard deviation Stock A ___%
Standard Deviation Stock B ___%
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