You are considering investing in a firm that has the following possible outcomes: Economic boom: probability of 25%; return of 25%
Economic growth: probability of 60%; return of 15%
Economic decline: probability of 15%; return of -5%
What is the standard deviation of returns on the investment?
A) 84.75%
B) 15.28%
C) 12.47%
D) 9.21
Correct Answer:
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