A non-dividend-paying stock with price, , is trading at RM50. Assume that the

expected return is 10% and its volatility is 20% (both at annual rates), find the expected

value and the variance of the stock price.

A non-dividend-paying stock with price, K, is trading at RM50. Assume that the expected return is 10% and its volatility is 20% (both at annual rates), find the expected value and the variance of the stock price. [5 marks]