Financial Management : Return and standard deviations

 

 

The market and Stock J have the following probability distributions:

Probability                          rM                          rJ

   0.3                                       15%                        20%

0.4                                          9                              5

0.3                                          18                           12

a. Calculate the expected rates of return for the market and Stock J.

b. Calculate the standard deviations for the market and Stock J.