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You believe that with a probability of (20% likelihood), there might be an economic boom next year. In this case, you believe your portfolio would
You believe that with a probability of (20% likelihood), there might be an economic boom next year. In this case, you believe your portfolio would likely generate a return of 35% However, there is also a probability of 3 that there could be a recession next year, in which case your portfolio value would decline by 30%If there is neither a boom nor a recession, you expect an % return. What is the standard deviation of your portfolio?
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