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Florida Company (FC)and Minnesota Company (MC)are Both Service Companies

Question 2

Multiple Choice

Florida Company (FC) and Minnesota Company (MC) are both service companies. Their stock returns for the past three years were as follows: FC: −5 percent, 15 percent, 20 percent; MC: 8 percent, 8 percent, 20 percent.
Calculate the standard deviations of returns for FC and MC. (Ignore the correction for the loss of a degree of freedom set out in the text.)


A) FC: 10.8 percent; MC: 5.7 percent
B) FC: 18.7 percent; MC: 9.8 percent
C) FC: 13.2 percent; MC: 6.9 percent
D) FC: 6.9 percent; MC: 13.2 percent

Correct Answer:

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