A project has a 0.7 chance of doubling your investment in a year and a 0.3 chance of halving your investment in a year. What is the standard deviation of the rate of return on this investment?

Explanation:

Given that 0.7 chance of doubling your investment in a year and a 0.3 chance of halving your investment in a year.

So the expected return is:

r =  0.7*100 + 0.3*-50%

= 70% - 15%

= 55%

=0.14175+0.33075

=0.4725

=47.25%

=0.6874

= 68.74%

answer; organizational;