You plan to invest$$ $$1,000$ in a corporate bond fund or in a common stock fund. The information to the right about the annual return$($per $$1,000)$ of each of these investments under different economic conditions is available, along with the probability that each of these economic conditions will occur. Complete parts $($a$)$ through $($d$)$ below.

a$.$ Compute the expected return for the corporate bond fund and for the common stock fund.

The expected return for the corporate bond fund is

$($Round to two decimal places as needed.$)$

The expected return for the common stock fund is

$($Round to two decimal places as needed.$)$

b$.$ Compute the standard deviation for the corporate bond fund and for the common stock fund.

The standard deviation for the corporate bond fund is

$($Round to two decimal places as needed.$)$

The standard deviation for the common stock fund is

$($Round to two decimal places as needed.$)$

c$.$ Would you invest in the corporate bond fund or the common stock fund? Explain.

Based on the expected value, the

fund should be chosen. Since the standard deviation for the common stock fund is $$

$]$ that for the corporate bond fund, the common stock fund

the corporate bond fund

and an investor $$ the risk when making a decision.

d$.$ If you chose to invest in the common stock fund in $($c$),$ what do you think about the possibility of losing $$999$ of every $$1,000$ invested if there is an extreme recession?

A$.$ If you chose the common stock fund, you would need to assess your reaction to the high possibility that you could lose $50\%$ of your entire investment.

B$.$ If you chose the common stock fund, you would need to assess your reaction to the small possibility that you could lose $50\%$ of your entire investment.

C$.$ If you chose the common stock fund, you would need to assess your reaction to the high possibility that you could lose virtually all of your entire investment.

D$.$ If you chose the common stock fund, you would need to assess your reaction to the small possibility that you could lose virtually all of your entire investment.