The annual returns, in percentages, on stocks A and B for three possible states of the economy are given in the table below.

Economy State: Good, Probability: 0.5, Stock A: 40 Stock B: 20

Economy State: Average, Probability: 0.3, Stock A: 20 Stock B: 40

Economy State: Bad, Probability: 0.2, Stock A: 10 Stock B: 8

Question: If one invested in StockA, what would be the standard deviation of the percentage return? Place your answer, in percent rounded to 1 decimal place, in the blank. For example, a standard deviation of 10.39 percent would be reported as 10.4. Do not use a percent sign.

Economy State: Good, Probability: 0.5, Stock A: 40 Stock B: 20

Economy State: Average, Probability: 0.3, Stock A: 20 Stock B: 40

Economy State: Bad, Probability: 0.2, Stock A: 10 Stock B: 8

Question: If one invested in StockA, what would be the standard deviation of the percentage return? Place your answer, in percent rounded to 1 decimal place, in the blank. For example, a standard deviation of 10.39 percent would be reported as 10.4. Do not use a percent sign.

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Calculation of Standard Deviation in percentage return for Stock A

Economy

State

Good

Average

Bad

Stock A

(x)

40

20

10

(y-x)

(y-x)

-16.67 277.88

3.33

11.08

13.37 177.68

Probability

(f)

0.5...