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Consider the following information: Rate of Return if State Occurs State of Probability of State Economy of Economy Stock A Stock B Recession .15 .02
Consider the following information: |
Rate of Return if State Occurs | |||
State of | Probability of State | | |
Economy | of Economy | Stock A | Stock B |
Recession | .15 | .02 | .30 |
Normal | .55 | .10 | .18 |
Boom | .30 | .15 | .31 |
|
Requirement 1: |
Calculate the expected return for the two stocks. (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) |
Expected return | |
E(RA) | % |
E(RB) | % |
|
Requirement 2: |
Calculate the standard deviation for the two stocks. (Do not round intermediate calculations. Enter your answers as a percentage rounded to 2 decimal places (e.g., 32.16).) |
Standard deviation | |
?A | % |
?B | % |
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