Use the Following Table Estimate the Difference Between the Standard Deviations for Large- and |

question 6

Multiple Choice

Use the following table: $$\begin{array} { | l | c | c | c | c | } \hline \begin{array} { l } \text { States of the } \\\text { Economy }\end{array} & \begin{array} { c } \text { Probability of the } \\\text { State }\end{array} & \begin{array} { c } \text { 3-Month } \\\text { T-Bill }\end{array} & \begin{array} { c } \text { Large-Company } \\\text { Stock }\end{array} & \begin{array} { c } \text { Small-Company } \\\text { Stock }\end{array} \\\hline \text { Boom } & 0.3 & 4 \% & 10 \% & 30 \% \\\hline \text { Steady } & 0.5 & 4 \% & 5 \% & 20 \% \\\hline \text { Recession } & 0.2 & 4 \% & 0 \% & 10 \% \\\hline\end{array}$$ Estimate the difference between the standard deviations for large- and small-company stocks.Which is larger and by how much?

• A)Small company stocks by 49.00%
• B)Small company stocks by 36.75%
• C)Large company stocks by 12.25%
• D)Small company stocks by 3.50%

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