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Consider the following information: Probability of State of Economy State of Economy Recession .20 Normal .60 Boom .20 Calculate the expected return for Stock A.

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Consider the following information: Probability of State of Economy State of Economy Recession .20 Normal .60 Boom .20 Calculate the expected return for Stock A. Expected return Calculate the expected return for Stock B. Expected return Calculate the standard deviation for Stock A. Standard deviation Rate of Return if State Occurs Stock A Stock B .02 -.18 .07 .13 .13 .34

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