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Consider the following information: Rate of Return if State Occurs State of Economy Probability of State of Economy Stock A Stock B Recession 0.20 0.03
Consider the following information: |
Rate of Return if State Occurs | |||
State of Economy | Probability of State of Economy | Stock A | Stock B |
Recession | 0.20 | 0.03 | -0.21 |
Normal | 0.60 | 0.07 | 0.12 |
Boom | 0.20 | 0.13 | 0.31 |
|
Required: |
(a) | Calculate the expected return for Stock A. (Do not round your intermediate calculations.) |
(Click to select)7.40%7.19%9.02%9.37%6.45% |
(b) | Calculate the expected return for Stock B. (Do not round your intermediate calculations.) |
(Click to select)9.20%7.33%10.66%8.74%9.57% |
(c) | Calculate the standard deviation for Stock A. (Do not round your intermediate calculations.) |
(Click to select)3.20%2.26%3.36%3.04%3.33% |
(d) | Calculate the standard deviation for Stock B. (Do not round your intermediate calculations.) |
(Click to select)16.80%11.88%18.64%15.96%17.47% |
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