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The expected return and standard deviation of returns of General Mills common stock over the next year are estimated to be 20 percent and 12 percent, respectively. Assume that the returns are approximately normally distributed.

a. Determine the probability of incurring a loss (negative rate of return) from investing in this stock.

b. Determine the probability of earning a rate of return less than the risk-free rate of 6 percent.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92092261

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