Business, 21.12.2020 20:20 Nicaragua505

A stock will provide a rate of return of either −18% or 26%. a. If both possibilities are equally likely, calculate the stock's expected return and standard deviation. (Do not round intermediate calculations. Enter your answers as a whole percent.)
b. If Treasury bills yield 4% and investors believe that the stock offers a satisfactory expected return, what must the market risk of the stock be?

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A stock will provide a rate of return of either −18% or 26%. a. If both possibilities are equally l...