Westover stock is expected to return 36 percent in a boom,14 percent in a normal economy,and lose 75 percent in a recession.The probabilities of a boom,normal economy,and a recession are 2 percent,93 percent,and 5 percent,respectively.What is the standard deviation of the returns on this stock?
A)19.90 percent
B)20.52 percent
C)20.41 percent
D)18.79 percent
E)19.74 percent

Question

Quizplus · Accepted Answer

The Answer of Westover stock is expected to return 36 percent in a boom,14 percent in a normal economy,and lose 75 percent in a recession.The probabilities of a boom,normal economy,and a recession are 2 percent,93 percent,and 5 percent,respectively.What is the standard deviation of the returns on this stock?
A)19.90 percent
B)20.52 percent
C)20.41 percent
D)18.79 percent
E)19.74 percent

Westover Stock Is Expected to Return 36 Percent in a Boom,14