Use the following table: States of the Economy Probability of the ...

[amal]

Use the following table: States of the Economy Probability of the State 3-Month T-Bill Large-Company Stock Small-Company Stock Boom 0.3 4 10 30 Steady 0.5 4 5 20 Recession 0.2 4 0 10
 
  What is the difference between the variances for large- and small-company stocks?
  A) 40.25
  B) 36.75
  C) 27.30
  D) 14.90

Question 2

Use the following table:
 
  States of the Economy Probability of the State 3-Month
  T-Bill Large-Company Stock Small-Company Stock
  Boom 0.3 4 10 30
  Steady 0.5 4 5 20
  Recession 0.2 4 0 10
 
  What is the difference between the standard deviation of a small-company stock and a 3-month T-bill?
  A) 7.0
  B) 5.5
  C) 4.0
  D) 3.5

[trog]

Answer to Question 1

Answer: B
Explanation: B)
3-Month
T-Bill Large-Company Stock Small-Company Stock
Er= 4 5.5 21
VAR= 0 12.25 49
STDEV= 0 3.5 7

So 49 - 12.25 = 36.75.

Answer to Question 2

Answer: A
Explanation: A) 7 - 0 = 7.

[amal]

Thanks for the timely response, appreciate it

[Jsherida]

YES! Correct, THANKS for helping me on my review