You are interested in buying a stock that has a price of $72. You have projected that next year there is: a 10% probability the stock will equal $10, a 20% probability the stock will equal $38, a 30% probability the stock will equal $73, a 30% probability the stock will equal $100, and a 10% probability the stock will equal $150. Answer the following (showing all work):
(a) what is the expected return on the stock if you buy today and sell next year?
(b) what is the expected standard deviation of the stock?