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In a booming economy, a firm s stock is expected to return 1 7 . 7 percent. It is expected to return 8 . 2
In a booming economy, a firms stock is expected to return percent. It is expected to return percent in a normal economy and will decline percent in a recessionary economy. The probability of a recession is percent while the probability of a boom is percent. What is the standard deviation of the returns on this stock?
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