Consider the following information: |
Rate of Return if State Occurs | |||
State of Economy | Probability of State of Economy | Stock A | Stock B |
Recession | 0.10 | 0.03 | -0.21 |
Normal | 0.60 | 0.08 | 0.15 |
Boom | 0.30 | 0.13 | 0.32 |
Required: |
(a) |
Calculate the expected return for Stock A. (Do not round your intermediate calculations.) |
(b) |
Calculate the expected return for Stock B. (Do not round your intermediate calculations.) |
(c) |
Calculate the standard deviation for Stock A. (Do not round your intermediate calculations.) |
(d) |
Calculate the standard deviation for Stock B. (Do not round your intermediate calculations.) |
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