Question

Consider the following information:

  

				Rate of Return if State Occurs
State of	Probability of
Economy	State of Economy			Stock A			Stock B
Recession		.10			.04		−	.17
Normal		.60			.09			.12
Boom		.30			.17			.27

  

a.	Calculate the expected return for Stocks A and B. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
b.	Calculate the standard deviation for Stocks A and B. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

Please be specific and provide formulas.  

Answer 1