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Consider the following information: State of Economy Recession Normal Boom Probability of State of Economy 15 .55 .30 Rate of Return if State Occurs Stock A .04 .09 .17 Stock B -.17 .12 .27 a. Calculate the expected return for Stocks A and B. (Do not round intermediat calculations and enter your answers as a percent rounded to 2 decimal places, e.g 32.16.) b. Calculate the standard deviation for Stocks A and B. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g... 32.16.)

Consider the following information: State of Economy Recession Normal Boom Probability of State of Economy 15 .55 .30 Rate of Return if State Occurs Stock A .04 .09 .17 Stock B -.17 .12 .27 a. Calculate the expected return for Stocks A and B. (Do not round intermediat calculations and enter your answers as a percent rounded to 2 decimal places, e.g 32.16.) b. Calculate the standard deviation for Stocks A and B. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g... 32.16.)

Essentials Of Investments
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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Consider the following information: State of Economy Recession Normal Boom Probability of State of Economy 15 .55 .30 a. Stock A expected return a. Stock B expected return b. Stock A standard deviation b. Stock B standard deviation Rate of Return if State Occurs Stock A .04 .09 17 a. Calculate the expected return for Stocks A and B. (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 Stocks A and B. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) % % % % Stock B -.17 12 .27
Transcribed Image Text:Consider the following information: State of Economy Recession Normal Boom Probability of State of Economy 15 .55 .30 a. Stock A expected return a. Stock B expected return b. Stock A standard deviation b. Stock B standard deviation Rate of Return if State Occurs Stock A .04 .09 17 a. Calculate the expected return for Stocks A and B. (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 Stocks A and B. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) % % % % Stock B -.17 12 .27
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