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2.The rates of return on Cherry Jalopies, Inc., stock over the last five years were 24...

2.The rates of return on Cherry Jalopies, Inc., stock over the last five years were 24 percent, 11 percent, −6 percent, 7 percent, and 10 percent. Over the same period, the returns on Straw Construction Company’s stock were 16 percent, 23 percent, −5 percent, 3 percent, and 15 percent.

.Calculate the variances and the standard deviations for Cherry and Straw. (Do not round intermediate calculations. Enter your variance as a decimal rounded to 5 decimal places. Enter your standard deviat

Cherry

Straw

Variance

Standard deviation

%

%

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Answer #1

Standard deviation is calculated by using the return on an investment over a period of time. Standard deviation helps to measure the risk associated with a portfolio or stock. Higher the standard deviation, higher is the risk associated with the stock. It is the square root of the variance.

Variance calculates how much the returns on a stock are far apart. It is used to measure the risk associated with a stock. Variance is used to calculate the standard deviation.

Based on the information given in the question,

mulastan ormula Yarian ce--泛CR-R)2Chuy dalopies Inc Retuun 244 4.8 219.04 1.8 3.24 23 1 .04 -15.2 -2.2 0.8 0.64 10 46 Re--kuun en stock. Cheung(e4ectea» 8Variance sce-at- 458, 8-91 FG 5 Standard deuation-Nariance9.51914 euua F1Strau Conshu cluon Company 31. 3G 5. 12.6158.70 15.4 237.I6 7.4 54.16 4.G | 21,16 1 6 2 3 3 IS 52 503.2 R Retwen em sto ck shouolexpe ut eo) arianceECR-R503100.6 Stand aud deiation Nariance-V100.6 -10.031957.cheu Nariance loo. 64 ndard deviation | 9.57914|./-1 10.08 1931-01.Do leave me an upvote if this answer was helpful. In case of any follow-up questions feel free to comment.

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