Question
KNF stock is quite cyclical. In a boom economy, the stock is expected to return 30% in comparison to 12% in a normal economy and
KNF stock is quite cyclical. In a boom economy, the stock is expected to return 30% in comparison to 12% in a normal economy and -17% in a recessionary period. The probability of a recession is 25%. There is a 15% chance of a boom economy. What is the standard deviation of the returns on this stock?
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Contemporary Financial Management
Authors: R. Charles Moyer, James R. Mcguigan, William J. Kretlow
9th Edition
032416470X, 9780324164701
