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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 .25 .03

Consider the following information: Rate of Return if State Occurs State of Economy Probability of State of Economy Stock A Stock B Recession .25 .03 .15 Normal .55 .13 .13 Boom .20 .16 .33

a. Calculate the expected return for the two stocks.

b. Calculate the standard deviation for the two stocks.

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