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You have estimated the return of stocks A and B in three possible states of the economy in the following table. Probability of occurring State

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You have estimated the return of stocks A and B in three possible states of the economy in the following table. Probability of occurring State of the Stock A's return economy Recession 0.25 -0.1 Normal 0.5 0 Boom =O.025 0.1 0.25 a) Calculate the expected return of stock A. (10 points) b) Calculate the standard deviation of stock A. (15 points)

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