In: Finance
Consider the following information: |
Rate of Return if State Occurs | |||
State of Economy | Probability of State of Economy | Stock A | Stock B |
Recession | 0.20 | 0.05 | -0.21 |
Normal | 0.60 | 0.09 | 0.17 |
Boom | 0.20 | 0.14 | 0.32 |
Required: |
(a) |
Calculate the expected return for Stock A. (Do not round your intermediate calculations.) |
(Click to select)9.20%8.85%10.91%11.03%8.32% |
(b) |
Calculate the expected return for Stock B. (Do not round your intermediate calculations.) |
(Click to select)12.40%9.33%14.02%11.78%12.90% |
(c) |
Calculate the standard deviation for Stock A. (Do not round your intermediate calculations.) |
(Click to select)2.86%2.02%3.00%2.71%2.97% |
(d) |
Calculate the standard deviation for Stock B. (Do not round your intermediate calculations.) |
(Click to select)17.68%12.50%19.57%16.80%18.39% |