Question
Consider the following information: State of Economy Recession Normal Boom Probability of State of Economy Rate of Return if State Occurs Stock A Stock
Consider the following information: State of Economy Recession Normal Boom Probability of State of Economy Rate of Return if State Occurs Stock A Stock B .04 .11 .25 -.11 .60 .15 .14 .15 .35 a. Calculate the expected return for the two stocks. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Expected return for A Expected return for B % % b. Calculate the standard deviation for the two stocks. (Do not round your intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Standard deviation for A % Standard deviation for B %
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Corporate Finance Core Principles and Applications
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan
5th edition
1259289907, 978-1259289903
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