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Consider the following two, completely separate. Economies. The expected return and volatility of all stocks in both economies is the same, In the first economy,

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Consider the following two, completely separate. Economies. The expected return and volatility of all stocks in both economies is the same, In the first economy, all stocks move together m dash in good times all prices rise together and in bad times they all fall together, In the second economy, stock returns are independent m dash one stock increasing in price has no effect on the prices of other stocks. Assuming you are risk-averse and you could choose one of the two economies in which to invest, which one would you choose? Explain

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