Consider the following information:
State Probability ABC, Inc. Return XYZ, Inc. Return
Boom .25 0.18 0.27
Normal .50 0.10 0.18
Slowdown .10 0.08 0.06
Recession .15 -0.02 -0.12
For both ABC and XYZ, answer the following. Upload the Excel file.
a) What is the expected return?
b) What is the variance?
c) What is the standard deviation?