Exhibit 6-13
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S) $\begin{array}{cc}\text { Probability } & \text { Return } \\\hline 0.10 & -.20 \\0.25 & -.05 \\0.40 & 0.15 \\0.25 & 0.30\end{array}$

question 44

Multiple Choice

Exhibit 6-13
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)
A financial analyst covering Magnum Oil has determined the following four possible returns given four different states of the economy over the next period. $\begin{array}{cc}\text { Probability } & \text { Return } \\\hline 0.10 & -.20 \\0.25 & -.05 \\0.40 & 0.15 \\0.25 & 0.30\end{array}$
-Refer to Exhibit 6-13. Calculate the standard deviation for Magnum Oil.

• A) 0%
• B) 11%
• C) 16%
• D) 20%
• E) 26%

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Definitions:

Unrecognized Net Loss

A loss that has occurred but has not been reported in the financial statements because it has not yet been realized through a transaction.

Projected Benefit Obligation

A measurement of the present value of future pension benefits owed to employees, based on factors like salary history and years of service.

Plan Assets

Resources set aside by a company in a dedicated fund to meet future pension benefits or other long-term employee benefits.

Vested Benefits

Employee benefits, such as pension funds or stock options, that are fully granted and cannot be forfeited even if the employment is terminated.