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An analyst has developed the following probability distribution for the rate of return for a common stock.

Scenario | Probability | Rate of Return |
---|---|---|

1 | 0.30 | ?5% |

2 | 0.45 | 0% |

3 | 0.25 | 10% |

**a.** Calculate the expected rate of return. **(Round intermediate calculations to at least 4 decimal places.)**

**b.** Calculate the variance and the standard deviation of this probability distribution. **(Use the percentage values for your calculations (for example 10% not 0.10). Round intermediate calculations to at least 4 decimal places. Enter your answers as a percentage rounded to 2 decimal places.)**

a. The expected rate of return is calculated by taking the weighted average of the rates of return for each scenario, where the weights are