A stock has the following probability distribution: If economy is good (the probability is 0

Finance Feb 15, 2021

A stock has the following probability distribution: If economy is good (the probability is 0.2), its expected stock return is 25%; if economy is on average (the probability is 0.6), its expected stock return is 8%; if economy is bad (the probability is 0.2), its expected return is -15%. Find the expected rate of return for the stock

5.2%

6.0%

6.8%

8.5%

Using the data from Question 33, find the standard deviation (risk) for the stock

11.06%

12.23%

13.56%

13.90%

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