1. Stock A has the following returns for various states of the economy:
State of Economy Probability Stock A's Return
Recession 5% -50%
Below average 25% -3%
Average 35% 10%
Above average 20% 20%
Boom 15% 45%
Stock A's expected return is _________
11%
22%
4.4%
9.75%
2. Stock A has the following returns for various states of the economy:
State of Economy Probability Stock A's Return
Recession 5% -50%
Below average 25% -3%
Average 35% 10%
Above average 20% 20%
Boom 15% 45%
Stock A's standard deviation of returns is _______
20.62%
4.25%
6.47%
11%