(c) Jessy, would like to invest in share G, and is aware that the return...
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(c) Jessy, would like to invest in share G, and is aware that the return on this share is sensitive to the economy condition. Her analysis indicates that three different states of economy can affect the investment return. Based on the rate of return of share G and probabilities for the three possible economy condition given in the table below, compute the expected rate of return and standard deviation of return for share G. Rate of Return Economy condition Worst Normal Probability 0.2 0.5 10% 15% Best 0.3 25% (7 marks)
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