A what is the expected rate of return for stock a b what


An analyst thinks the following three scenarios are possible for Stock A:

1) bear market, probability = .2, Stock A return = -20%;

2) normal market, probability = .4, Stock A return = 10%;

3) bull market, probability = .4, Stock A return = 20%.

A) What is the expected rate of return for Stock A?

B) What is the standard deviation for Stock A?

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