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Following are four economic states, their likelihoods, and the potential returns: Economic State Probability Return Fast...

Following are four economic states, their likelihoods, and the potential returns:

Economic State Probability Return
Fast growth 0.32 62 %
Slow growth 0.43 18
Recession 0.15 −8
Depression 0.10 −42

Compute the expected return and standard deviation. (Do not round intermediate calculations and round your answers to 2 decimal places.)

Expected return _____%

Standard deviation ______%

Solutions

Expert Solution

The expected return and standard deviation is calculated in excel below

jeff jeffy answered 2 years ago
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