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Consider the following scenario analysis: Rate of Return Scenario Probability Stocks Bonds Recession 0.30 5 % 18 % Normal economy 0.60 19 % 7 %
Consider the following scenario analysis:
Rate of Return | |||||
Scenario | Probability | Stocks | Bonds | ||
Recession | 0.30 | 5 | % | 18 | % |
Normal economy | 0.60 | 19 | % | 7 | % |
Boom | 0.10 | 24 | % | 7 | % |
b. Calculate the expected rate of return and standard deviation for each investment. (Do not round intermediate calculations. Enter your answers as a percent rounded to 1 decimal place.) I already got the answer for expected rate of return of stocks and bonds down below
Expected Rate of Return | Standard Deviation | |||
Stocks | 12.3 | % | % | |
Bonds | 10.3 | % | % |
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