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Consider the following information about Stocks I and II: Rate of Return If State Occurs State of Probability of Economy State of Stock Stock Il
Consider the following information about Stocks I and II: Rate of Return If State Occurs State of Probability of Economy State of Stock Stock Il Economy Recession 30 ,05 - 30 Normal 45 22 10 Irrational 25 05 50 exuberance The market risk premium is 6 percent, and the risk free rate is 2 percent. (Do not round intermediate calculations, Round your answers to 2 decimal places, e.g. 32.16. Enter your return answers as a percent.) The standard deviation on Stock I's return is percent, and the Stock I beta is The standard deviation on Stock It's return is percent, and the Stock 11 beta is Therefore, based on the stock's systematic risk/beta, Stock (Click to select) is "riskier
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