Question
Use the following information on states of the economy and stock returns to calculate the standard deviation of returns. (Do not round intermediate calculations. Enter
Use the following information on states of the economy and stock returns to calculate the standard deviation of returns. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
| State of Economy | Probability of State of Economy | Security Return if State Occurs | ||||||||||
| Recession | 0.45 | 5.00 | % | |||||||||
| Normal | 0.40 | 12.00 | ||||||||||
| Boom | 0.15 | 16.00 | ||||||||||
Standard Deviation
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Investments
Authors: Zvi Bodie, Alex Kane, Alan J. Marcus
9th Edition
73530700, 978-0073530703
