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Kayla recently invested in real estate with the intention of selling the property 1 year from today. She has modelled the returns on that investment
Kayla recently invested in real estate with the intention of selling the property 1 year from today. She has modelled the returns on that investment based on three economic scenarios. She believes that if the economy stays healthy, then her investment will generate a 30 per cent return. However, if the economy softens, as predicted, the return will be 10 per cent, while the return will be -25 per cent if the economy slips into a recession. If the probabilities of the healthy, soft and recessionary states are 0.2, 0.6 and 0.2, respectively, then what are the expected return, variance and standard deviation of Kayla's investment
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