. Compute expected return for stock x and for stock y. b. compute the standard deviation for stock x and stock y. c. Would you invest in stock x or stock y? explain.

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a. Compute expected return for stock x and for stock y.
b. compute the standard deviation for stock x and stock y.
c. Would you invest in stock x or stock y? explain.
 
 
You are trying to develop a strategy for investing in two different
stocks. The anticipated annual return for a $1,000 investment in
Returns
Economic
each stock under four different economic conditions has the
ProbabilityCondition
Stock X Stock Y
probability distribution shown to the right. Complete parts (a)
through (c) below.
0.1
Recession
- 50
- 160
Slow growth
Moderate growth
Fast growth
0.2
30
50
0.4
90
150
0.3
170
190
Transcribed Image Text:You are trying to develop a strategy for investing in two different stocks. The anticipated annual return for a $1,000 investment in Returns Economic each stock under four different economic conditions has the ProbabilityCondition Stock X Stock Y probability distribution shown to the right. Complete parts (a) through (c) below. 0.1 Recession - 50 - 160 Slow growth Moderate growth Fast growth 0.2 30 50 0.4 90 150 0.3 170 190
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