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The Grunewald Company has developed the following data regarding the rates of return on a potential stock and the market: State of the Economy Probability

The Grunewald Company has developed the following data regarding the rates of return on a potential stock and the market: State of the Economy Probability of Each Rates of Return If State occurs _________________ State Occurring Stock A Market Deep Recession .20 (20%) (30%) Mild recession .20 10 5 Average .20 15 20 Mild boom .20 20 25 Strong boom .20 25 30 a. Calculate the standard deviations for the stock A and the market. b. Calculate the betas for the stock A c. Calculate the probability that stock As return is greater than 10%, that is P (K>10%)=?

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