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please explain step by step. a. Consider an economy with two types of firms, S and I. S firms always move exactly together, but I
please explain step by step.
a. Consider an economy with two types of firms, S and I. S firms always move exactly together, but I firms move independently of each other. For both types of firms there is a 60% probability that the firm will have a 20% return and a 40% probability that the firm will have a 30% return. i. What are the expected returns and standard deviation for firms S and I? (4 marks)Step by Step Solution
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