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What is the standard deviation of the returns on a stock given the following information? State of Economy Probability of State of Economy Return if

What is the standard deviation of the returns on a stock given the following information?

State of Economy Probability of State of Economy Return if State Occurs
Boom 30% 14%
Normal 65% 8%
Recession 5% -5%

Multiple Choice

  • 7.05%

  • 6.60%

  • 6.38%

  • 5.98%

  • 4.23%

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