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Stocks A and B have the following probability distributions of expected future returns in accordance with economic conditions. Economic Condition Recession Below Average Average Above Average Booming Probability 0.1 0.2 0.4 0.2 0.1 A B (12%) (32%) (3) 4 14 22 40 17 23 42 Calculate the expected return, standard deviation, and coefficient of variation for both stocks. Which stock do you prefer and why?

Stocks A and B have the following probability distributions of expected future returns in accordance with economic conditions. Economic Condition Recession Below Average Average Above Average Booming Probability 0.1 0.2 0.4 0.2 0.1 A B (12%) (32%) (3) 4 14 22 40 17 23 42 Calculate the expected return, standard deviation, and coefficient of variation for both stocks. Which stock do you prefer and why?

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
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Stocks A and B have the following probability distributions of expected future returns in accordance with economic conditions. Economic Condition Recession Below Average Average Above Average Booming Probability 0.1 0.2 0.4 0.2 0.1 A (12%) 4 14 22 40 B (32%) (3) 17 23 42 Calculate the expected return, standard deviation, and coefficient of variation for both stocks. Which stock do you prefer and why?
Transcribed Image Text:Stocks A and B have the following probability distributions of expected future returns in accordance with economic conditions. Economic Condition Recession Below Average Average Above Average Booming Probability 0.1 0.2 0.4 0.2 0.1 A (12%) 4 14 22 40 B (32%) (3) 17 23 42 Calculate the expected return, standard deviation, and coefficient of variation for both stocks. Which stock do you prefer and why?
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