Answered step by step
Verified Expert Solution
Question
1 Approved Answer
A stock will have a loss of 11.8 percent in a bad economy, a return of 11.6 percent in a normal economy, and a return
A stock will have a loss of 11.8 percent in a bad economy, a return of 11.6 percent in a normal economy, and a return of 25.5 percent in a hot economy. There is 26 percent probability of a bad economy, 29 percent probability of a normal economy, and 45 percent probability of a hot economy. What is the variance of the stock's returns?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started