An Investor Has Purchased an Auto Stock

Multiple Choice

An investor has purchased an auto stock. It is expected that during a good economy, the stock will provide a 12% return, while in a poor economy the stock will provide an -4% return. The probability of a good economy is expected to be 70%. Given this information, calculate the standard deviation for this stock.

A) 4.63%
B) 5.53%
C) 6.43%
D) 7.33%
E) 8.23%