Answered step by step
Verified Expert Solution
Question
1 Approved Answer
You believe that next year there is a 20% probability of a recession and 80% probability that the economy will be normal. If your stock
You believe that next year there is a 20% probability of a recession and 80% probability that the economy will be normal. If your stock will yield negative 12% in a recession and 18% in a normal year, what is the standard deviation of the stock?
The standard deviation of the stock is __%. (Round to two decimal places.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started