Consider the following information: State Probability ABC, Inc. Return Boom .25 0.15 Normal .50 0.08 Slowdown .15 0.04 Recession .10 -0.03 • What is the expected return? • What is the variance? • What is the standard deviation?

Consider the following information: State Probability ABC, Inc. Return Boom .25 0.15 Normal .50 0.08 Slowdown .15 0.04 Recession .10 -0.03 • What is the expected return? • What is the variance? • What is the standard deviation?

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter5: Probability: An Introduction To Modeling Uncertainty

Section: Chapter Questions

Problem 34P

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Question

EXAMPLE
• Consider the following information:
State Probability ABC, Inc. Return
Boom .25 0.15
Normal .50 0.08
Slowdown .15 0.04
Recession .10 -0.03
• What is the expected return?
• What is the variance?
• What is the standard deviation?

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