Problem 11-3 Expected Returns and Deviations (LO1, CFA2)

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

State of Economy	Security Return if State Occurs
Recession		7.00	%
Normal		9.00
Boom		21.00