If the economy booms,RTF,Inc. stock is expected to return 15%. If the economy goes into a recessionary period,then RTF is expected to only return 3%. The probability of a boom is 60% while the probability of a recession is 40%. What is the variance of the returns on RTF,Inc. stock?
A) .00125
B) .00345
C) .00629
D) .00731
E) .12583

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The Answer of If the economy booms,RTF,Inc. stock is expected to return 15%. If the economy goes into a recessionary period,then RTF is expected to only return 3%. The probability of a boom is 60% while the probability of a recession is 40%. What is the variance of the returns on RTF,Inc. stock?
A) .00125
B) .00345
C) .00629
D) .00731
E) .12583

If the Economy Booms,RTF,Inc