If treasury bills yield 5 and investors believe that the


A stock will provide a rate of return of either –20% or +30%. a. If both possibilities are equally likely, calculate the expected return and standard deviation. (Round your answers to the nearest whole percent.) The expected return % Standard deviation % b. If Treasury bills yield 5%, and investors believe that the stock offers a satisfactory expected return, what must be the market risk of the stock? (Round your answer to the nearest whole percent.) The market risk %

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Financial Management: If treasury bills yield 5 and investors believe that the
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