Consider the following probability distribution for stocks C and D: The standard deviations of stocks C and D are _____ and _____, respectively.
A)7.62%; 11.24%
B)11.24%; 7.62%
C)10.35%; 12.93%
D)12.93%; 10.35%

Question

Consider the following probability distribution for stocks C and D:  The standard deviations of stocks C and D are _____ and _____, respectively.
A)7.62%; 11.24% 
B)11.24%; 7.62% 
C)10.35%; 12.93% 
D)12.93%; 10.35%

Quizplus · Accepted Answer

s_C = [0.30(7% - 4.4%)² + 0.5(11% - 4.4%)² + 0.20(-16% - 4.4%)²]^1/2 = 10.35%; s_D = [0.30(-9% - 9.5%)² + 0.50(14% - 9.5%)² + 0.20(26% - 9.5%)²]^1/2 = 12.93%.

Consider the Following Probability Distribution for Stocks C and D