A stock will provide a rate of return of either minus23 or


A stock will provide a rate of return of either −23% or 34%. a. If both possibilities are equally likely, calculate the stock's expected return and standard deviation. (Do not round intermediate calculations. Enter your answers as a percent rounded to 1 decimal place.) Expected return 5.5 % Standard deviation 16.0 % b. If Treasury bills yield 5.5% and investors believe that the stock offers a satisfactory expected return, what must the market risk of the stock be? (Enter your answer as a whole percent.) Market risk %

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Financial Management: A stock will provide a rate of return of either minus23 or
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