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22 May, 02:17

A project has a 0.7 chance of doubling your investment in a year and a 0.3 chance of halving your investment in a year. What is the standard deviation of the rate of return on this investment? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

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  1. 22 May, 02:35
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    68.74%

    Explanation:

    Expected return

    =0.7*100%-0.3*50%

    =55%

    standard deviation = (0.70 * (100%-55%) ^2+0.30 * (-50%-55%) ^2) ^ (1/2)

    =68.74% is answer
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Home » Business » A project has a 0.7 chance of doubling your investment in a year and a 0.3 chance of halving your investment in a year. What is the standard deviation of the rate of return on this investment? (Do not round intermediate calculations.
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