An Investor Has Purchased an Auto Stock

question 407

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%

---

Definitions:

Loyalty To Neighbors

A sense of allegiance or support given to those living in close proximity, often manifesting in community assistance and solidarity.

Very Attractive

Possessing physical or other qualities that generate a high level of appeal or interest in others.

Groupthink

A psychological phenomenon that occurs within a group of people, where the desire for harmony or conformity results in an irrational or dysfunctional decision-making outcome.

Public Image

The perception of an individual, company, or organization held by the public, shaped by various forms of communication media and firsthand experiences.