Question
Consider the following information: Probability of State Rate of Return if State Occurs Economy of Economy Stock A Stock B Recession .21 .040 .41 Normal
Consider the following information: Probability of State Rate of Return if State Occurs Economy of Economy Stock A Stock B Recession .21 .040 .41 Normal .61 .120 .31 Boom .18 .300 .54 a. 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 E(RA) % E(RB) % 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 A % B %
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