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Part: Use the information in the following table to answer the questions below.

  • State of EconomyProbability of StateReturn on A in StateReturn on B in StateReturn on C in State
  • Boom.350.0400.2100.300
  • Normal.500.0400.0800.200
  • Recession.150.040-0.010-0.260

a. What is the expected return of each asset?

b. What is the variance of each asset?

c. What is the standard deviation of each asset?

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