QUESTION 2

As a financial analyst for an investment firm, you are responsible for advising your company on share capital investment, and you are provided with two different investments: Facebook and Instagram. The following is the data presented to you.

State of economy	Probability	Rate of Returns
		Facebook	Instagram
Recession	0.25	0.07	0.13
Moderate	0.50	0.15	0.15
Strong growth	0.25	0.23	0.17

Required:

1. Based on the above information, calculate the followings:
2. 1. The expected value for each investments return
3. 2. The standard deviation of the return for investment in Facebook and Instagram

2. Which investment should you advise your company to choose? Justify your answer.