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You are thinking about investing in a business started by a friend. Her research shows that if you give her $1,000, in one year you

You are thinking about investing in a business started by a friend. Her research shows that if you give her $1,000, in one year you will get back with equal probabilities either $700 or $1,400.

a. What is your expected return from this investment?

b. What is your risk (standard deviation) from this investment?

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