You are considering two stocks and have determined the following information: ...
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Accounting
You are considering two stocks and have determined the following information:
| Stock A | Return | Probability of the Return | ||
| 20 | % | 30 | % | |
| 15 | 30 | |||
| 11 | 40 | |||
| Stock B | Return | Probability of the Return | ||
| 30 | % | 20 | % | |
| 15 | 25 | |||
| 9 | 55 | |||
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Which of the two stocks has the higher expected return? Round your answers to two decimal places.
The return on Stock A: %
The return on Stock B: %
-Select-Stock AStock BItem 3 has the higher expected return.
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Which stock is riskier? Do not round intermediate calculations. Round your answers to two decimal places.
Standard deviation of Stock A:
Standard deviation of Stock B:
-Select-Stock AStock BItem 6 is riskier.
-
Given your answers to the two previous questions, what stock is preferred?
-Select-Stock AStock BItem 7 is preferred.
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