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Expected Return and Risk

Following are four economic states, their likelihoods, and the potential returns:

Economic State Probability Return

Fast growth 0.21 53 %

Slow growth 0.60 13

Recession 0.12 –22

Depression 0.07 –55

Compute the expected return and standard deviation. (Do not round intermediate calculations and

round your answers to 2 decimal places.)

Expected return  %

Standard deviation  %

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92744488

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