In: Finance
3. Jackson Corporation has expected return of 13% during recession, 10% during normal, and -5% during boom state of economy. Probability of recession, normal and boom states of economy is 0.25, 0.50, and 0.25 respectively. Find the expected return for Jackson Corporation. Round to the nearset hundredth percent. Answer in the percent format. Do not include % sign in your answer (i.e. If your answer is 4.33%, type 4.33 without a % sign at the end.)
4. You are considering investing in a project with the following possible outcomes:
Probability of
Investment
States Occurrence Returns
State 1: Economic boom 20% 16%
State 2: Economic growth 40%
12%
State 3: Economic decline 20%
5%
State 4: Depression 20%
-5%
Calculate the standard deviation of returns for this investment.
Round to the nearset hundredth percent. Answer in the percent
format. Do not include % sign in your answer (i.e. If your answer
is 4.33%, type 4.33 without a % sign at the end.)