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Consider the following information: Rate of Return If State Occurs Stock A Stock B State of Probability of State of Economy Economy Recession .15 Normal

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Consider the following information: Rate of Return If State Occurs Stock A Stock B State of Probability of State of Economy Economy Recession .15 Normal .61 Boom .24 .04 .07 .12 -.15 .14 .31 a. Calculate the expected return for Stocks A and B. (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 Stocks A and B. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Answer is complete but not entirely correct. a. 7.75 % 13.73 % Stock A expected return Stock B expected return Stock A standard deviation Stock B standard deviation b. 13.26 % 5.12 %

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