Task: Calculating Returns and Standard Deviation
Based on the following information, calculate the expected return and standard deviation:
|
State of Economy
|
Probability of State of Economy
|
Rate of Return if State Occurs
|
|
Depression
|
.10
|
-0.045
|
|
Recession
|
.20
|
0.044
|
|
Normal
|
.50
|
0.120
|
|
Boom
|
.20
|
0.207
|