The solution must show the break down of question and show all work. It can not be an excel document because I have to write it out on a word document and show all work leading up to the answer
Syntex is considering an investment in one of two stocks. Given the information that follows, which investment is better, based on the risk (the standard deviation) and return?
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Common Stock A
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Common Stock B
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|
Probability
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Return
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Probability
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Return
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0.20
|
10%
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0.10
|
-7%
|
|
0.60
|
16%
|
0.40
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5%
|
|
0.20
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21%
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0.40
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13%
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|
|
|
0.10
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20%
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Given the information in the table, what percent is the rate of return for Stock A?