Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

39) A stock has the following probability distribution: If economy is good (the probability is 25%), its expected stock return is 20%; if economy is

39) A stock has the following probability distribution: If economy is good (the probability is 25%), its expected stock return is 20%; if economy is on average (the probability is 50%), its expected stock return is 10%; if economy is bad (the probability is 25%), its expected return is -20%. Find the expected rate of return for the stock ______ 40) Using the data from Question 39, find the standard deviation (risk) for Hamilton's stock 41) Using the results from Question 39 and 40, compute the ratio of the standard deviation to the expected return for the stock______

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Handbook Of Consumer Finance Research

Authors: Jing Jian Xiao

2nd Edition

3319288857, 978-3319288857

More Books

Students also viewed these Finance questions

Question

4. Describe cultural differences that influence perception

Answered: 1 week ago