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Consider the following information: Economy Probability of State of Economy Rate of Return if State Occurs Stock A Stock B Recession .23 .025 -.38
Consider the following information: Economy Probability of State of Economy Rate of Return if State Occurs Stock A Stock B Recession .23 .025 -.38 Normal Boom .58 .19 .105 .28 .270 .51 a. Calculate the expected return for the two stocks. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. b. Calculate the standard deviation for the two stocks. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. a. Expected return of A Expected return of B b. Standard deviation of A Standard deviation of B % % 900 % 100 31.20%
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