Calculate the stocks expected return and standard deviation

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Reference no: EM13880650

Risk and Return. A stock will provide a rate of return of either −18% or +26%.

a. If both possibilities are equally likely, calculate the stock's expected return and standard deviation.

b. If Treasury bills yield 4% and investors believe that the stock offers a satisfactory expected return, what must the market risk of the stock be?

Reference no: EM13880650

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