XYZ stock's returns will have the following probability distribution during the possible states of the economy. a. Calculate the expected return on XYZ stock. b. Calculate the standard devivation of XYZ stock returns. c. Calculate the coefficient of variation of XYZ stock. State of Economy Probability Return Boom 30% 32.50% Normal 40% 10.25% Recession 30% -15.75%

Intermediate Financial Management (MindTap Course List)
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Author:Eugene F. Brigham, Phillip R. Daves
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Chapter3: Risk And Return: Part Ii
Section: Chapter Questions
Problem 1P: The standard deviation of stock returns for Stock A is 40%. The standard deviation of the market...
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XYZ stock's returns will have the following probability distribution during the possible states of the economy.
a. Calculate the expected return on XYZ stock.
b. Calculate the standard devivation of XYZ stock returns.
c. Calculate the coefficient of variation of XYZ stock.
State of Economy Probability Return
Boom 30% 32.50%
Normal 40% 10.25%
Recession 30% -15.75%

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