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t Variance and standard deviation (expected) Bacon and Associates, a famous Northwest think probabaty of a boom economy is 20%, the probability of a stable

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t Variance and standard deviation (expected) Bacon and Associates, a famous Northwest think probabaty of a boom economy is 20%, the probability of a stable growth economy is 45% the the standard deviation of the three investments stock, corporate bond, and correct, which investment would you choose, considering both risk and retun? tank, has provided probabity estimates for the four potential e economic states for the coming year. The probab try of a stagnant economy is 20%, and the probabery of a recesson 15% Caoane me vanrce ad government bond. if the estmates for both the probabintes of the economy and the returns in each state af the economy are Forecastod Returres for Each Eoonomy Stabl Boom 25% 12% Corporate bond 9% 7% 5% bond 8% 65% What is the variance of the stock investment? % (Round to five decimal places ) What is the standard deviation of the stock investment? (Round to two decimal places,) Click to select your answeris) What is the variance of the corporate bond investment? (Round to five decimal places.) What is the standard deviation of the corporate bond investment? [ ]% (Round to two decimal places.) What is the variance of the government bond investment? % (Round to five decimal places). What is the standard deviation of the government bond investment? % (Round to two decrnal places ) it the estimates for both the probabinies of the economy and the returns in each state of the economy are correct,which investment wouid you choose,considering both rsk and retum? (Slelect the best response.) O A. The corporate bond would be the best choice because it has the highest expected return and the owest mk O A. The corporate bond would be the best choice because it has the highest expected return and the lowest risk O B. The government bond would be the best choice because t has the lowest risk O c. The stoc investment would be the best choice because it has the highest volatity and therefore the O D. There is not enough information to make this decision. best choice because it has the highest volatility and therefore the best chance of a high return

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