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There is a 23.32% probability of a below-average economy and a 76.68% probability of an average economy. If there is a below-average economy, Stocks A
There is a 23.32% probability of a below-average economy and a 76.68% probability of an average economy. If there is a below-average economy, Stocks A and B will have returns of 3.12% and 3.67%, respectively. If there is an average economy, Stocks A and B will have returns of 19.28% and 5.89%, respectively. Compute the following for Stocks A and B: (Please write all answers as percentages (e.g. .1234 should be written as 12.34): A. Stock A Expected Return: % B. Stock B Expected Return: % C. Stock A Standard Deviation: % D. Stock B Standard Deviation: %
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