Returns for various states of the economy

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1. Stock A has the following returns for various states of the economy:

State of Economy Probability Stock A's Return

Recession 5% -50%

Below average 25% -3%

Average 35% 10%

Above average 20% 20%

Boom 15% 45%

Stock A's expected return is _________

   11%

   22%

   4.4%

   9.75%

2. Stock A has the following returns for various states of the economy:

State of Economy Probability Stock A's Return

Recession 5% -50%

Below average 25% -3%

Average 35% 10%

Above average 20% 20%

Boom 15% 45%

Stock A's standard deviation of returns is _______

   20.62%

   4.25%

   6.47%

   11%

Reference no: EM132056468

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