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A stock’s returns have the following distributions under different scenarios:

Economic Scenario                             Probability                                   Corresponding Rate of Return

Bust                                                       0.1                                               -30%

Below Average                                    0.1                                               -14%

Average                                                0.3                                                11%

Above Average                                   0.3                                                 20%

Boom                                                    0.2                                                 45%                      

                                                              1.0      

Given this, please calculate the stock’s expected return, standard deviation of returns and the coefficient of variation.

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M93041967

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