Expected rate of return and standard deviation on stock

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Reference no: EM131925221

You recently purchased a stock that is expected to earn 20 percent in a booming economy, 10 percent in a normal economy, and lose 30 percent in a recessionary economy. There is a 5 percent probability of a boom and a 75 percent chance of a normal economy. What is the expected rate of return and standard deviation on this stock? (Show your work)

Reference no: EM131925221

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