Exercise 3 Stocks X and Y have the following rates of return Economy Boom Normal Recession Rate of Return of X 18% 13% 2% Rate of return of Y 25% 10% -15% - The probability of a boom economy is 30% - The probability of a normal economy is 25% - The probability of an economy in recession is 45% 1- Calculate the expected rates of return for both X and Y. 2- Calculate the standard deviations of the rates of return of X and Y. 3- Calculate the correlation between the rates of return of both stocks