Question
Magee Inc.'s manager believes that economic conditions during the next year will be strong, normal, or weak, and she thinks that the firm's returns will
Magee Inc.'s manager believes that economic conditions during the next year will be strong, normal, or weak, and she thinks that the firm's returns will have the probability distribution shown below. What's the standard deviation of the estimated returns? EXPLAIN YOUR ANSWERS AND SHOW ALL WORK
| State of the Economy | Probability of State Occurring | Stock's Expected Return |
| Boom | 20% | 23.10% |
| Normal | 55% | 13.65% |
| Recession | 25% | 15.15% |
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Affordable Housing Finance
Authors: K. Hawtrey
2009th Edition
0230555187, 978-0230555181
