Consider the following information: Probability of Rate of Return if State Occurs Economy State of Economy Stock A Stock B Recession .20 .035 -.30 Normal Boom .60 .20 .115 .20 .190 .43 a. Calculate the expected return for the two stocks. Note: 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 the two stocks. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. a. Expected return of A Expected return of B % % b. Standard deviation of A % Standard deviation of B %
Consider the following information: Probability of Rate of Return if State Occurs Economy State of Economy Stock A Stock B Recession .20 .035 -.30 Normal Boom .60 .20 .115 .20 .190 .43 a. Calculate the expected return for the two stocks. Note: 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 the two stocks. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. a. Expected return of A Expected return of B % % b. Standard deviation of A % Standard deviation of B %
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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