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Problem 11-2 Standard Deviations (LO1, CFA2) Use the following information on states of the economy and stock returns to calculate the standard deviation of returns.

Problem 11-2 Standard Deviations (LO1, CFA2)

Use the following information on states of the economy and stock returns to calculate the standard deviation of returns. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

State of Economy Probability of State of Economy Security Return if State Occurs
Recession .35 8.00 %
Normal .50 14.00
Boom .15 24.00

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