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The following table shows the one-year return distribution


1.The figure below shows the one-year return distribution for RCS stock. Calculate

a. The expected return.

b. The standard deviation of the return.

 

103_probability.jpg

2.The following table shows the one-year return distribution of Startup, Inc. Calculate

a. The expected return.

b. The standard deviation of the return.

 

1915_probability.jpg

3.Characterize the difference between the two stocks in Problems 1 and 2. What trade-offs would you face in choosing one to hold?

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Finance Basics: The following table shows the one-year return distribution
Reference No:- TGS0761620

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