Consider the following scenario analysis: Scenario Recession Normal economy Boom Probability 0.20 0.60 0.20 Required A Required B Rate of Return Stocks -6% 19% 30% a. Is it reasonable to assume that Treasury bonds will provide higher returns in recessions than in booms? b. Calculate the expected rate of return and standard deviation for each investment. c. Which investment would you prefer? Required C Bonds 17% Complete this question by entering your answers in the tabs below. 9% 5%

Consider the following scenario analysis: a. Is it reasonable to assume that Treasury bonds will provide higher returns in recessions than in booms? b. Caiculate the expected rate of return and standard deviation for each investment. c. Which investment would you prefer? Complete this question by entering your answers in the tabs below. Is it reasonable to assume that Treasury bonds will provide higher returns in recessions than in booms? Is it reasonable to assume that Treasury bonds wil provide higher returns in recessions than in tomoms