Question
A stock will have a loss of 12.1 percent in a bad economy, a return of 11.9 percent in a normal economy, and a return
A stock will have a loss of 12.1 percent in a bad economy, a return of 11.9 percent in a normal economy, and a return of 25.8 percent in a hot economy. There is 23 percent probability of a bad economy, 26 percent probability of a normal economy, and 51 percent probability of a hot economy. What is the variance of the stock's returns?
Step by Step Solution
3.40 Rating (159 Votes )
There are 3 Steps involved in it
Step: 1
Heres how to calculate the variance of the stocks returns Define the vari...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 StartedRecommended Textbook for
Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
11th edition
324422870, 324422873, 978-0324302691
Students also viewed these Finance questions
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
Question
Answered: 1 week ago
View Answer in SolutionInn App