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Two companies are analyzing returns given 3 possible outcomes: Outcome Probability Worst Case 5% Most Likely 75% Best Case 20% Both companies have the same

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Two companies are analyzing returns given 3 possible outcomes: Outcome Probability Worst Case 5% Most Likely 75% Best Case 20% Both companies have the same Expected Return, however company B has a Standard Deviation double that of Company A. 1. Explain what the standard deviation measures 2. How can companies with the same probability of outcomes, and the same Expected Return have different Standard Deviation

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