Solution-What is the expected return on asset 1 and asset 2

What is the expected return on asset 1 and asset 2

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Reference no: EM133116933

The returns of two assets under four possible states of nature are given below:

State of nature Probability Return on asset1 Return on asset 2

1 0.40 -6% 12%

2 0.10 18% 14%

3 0.20 20% 16%

4 0.30 25% 20%

a. What is the expected return on Asset 1 and Asset 2?

b. What is the standard deviation of the return on asset 1 and on asset 2

Reference no: EM133116933

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What is the expected return on asset 1 and asset 2

Reference no: EM133116933

Reference no: EM133116933

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