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Please do this on pen and paper. NO EXCEL PLEASE!!! Question 7 3 pts If it is a rainy summer this year, the stock of

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Please do this on pen and paper. NO EXCEL PLEASE!!!

Question 7 3 pts If it is a rainy summer this year, the stock of Umbrella Inc. is expected to return 10%. If the summer is dry, then Umbrella's stock is expected to only return 4%. The probability of a rainy summer is 60% while the probability of a dry summer is 40%. What is the variance of the returns on Umbrella Inc. stock? 0.000864 0.000200 0.001594 0.000760 Question 8 3 pts Blue Bell stock is expected to return 18.4 percent in a boom, 8.9 percent in a normal economy, and 1.2 percent in a recession. The probabilities of a boom, normal economy, and a recession are 6 percent, 92 percent, and 2 percent, respectively. What is the standard deviation of the returns on this stock? 0.06 percent 9.32 percent 2.54 percent O 1.38 percent

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