Question
I need the answer to the standard deviation stock A Question. Problem 13-7 Calculating Returns and Standard Deviations [LO1] Consider the following information: Rate of
I need the answer to the standard deviation stock A Question.
Problem 13-7 Calculating Returns and Standard Deviations [LO1]
Consider the following information: |
|
| Rate of Return If State Occurs | |||||||
State of | Probability of | ||||||||
Economy | State of Economy | Stock A | Stock B | ||||||
Recession |
| .21 |
|
| .06 |
| .21 |
| |
Normal |
| .58 |
|
| .09 |
|
| .08 |
|
Boom |
| .21 |
|
| .14 |
|
| .25 |
|
Calculate the expected return for each stock. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) |
| Expected return |
Stock A | % 9.42 |
Stock B | % 5.48 |
Calculate the standard deviation for each stock. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) |
| Standard deviation |
Stock A | % ? |
Stock B | % 15.25 |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started