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You made 100k investment today. There are 60% chances that ending value will be 122k, and 40% chances that the value will be 80k. 1.

You made 100k investment today. There are 60% chances that ending value will be 122k, and 40% chances that the value will be 80k.

1. Calculate the expected value in year 1. Calculate standard deviation?

2. Calculate the rate of return from this investment ?

3. If the risk free investment offer 5%, what is the premium?

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