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The financial manager of Blackbelt Technologies wishes to determine the standard deviation from a proposed investment project. The expected returns from the project are related to the future performance of the economy over the period, as follows:
Economic scenario
|
Probability of occurrence
|
Rate of return
|
Strong growth
|
0,25
|
15%
|
Moderate growth
|
0,50
|
12%
|
Low growth
|
0,25
|
8%
|
What is the standard deviation of the proposed investment project?