Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A stock's return has the following distribution: Demand for the Company's Products Probability of This Demand Occurring Rate of Return if This Demand Occurs (%)

A stock's return has the following distribution:

Demand for the Company's Products Probability of This Demand Occurring Rate of Return if This Demand Occurs (%)
Weak 0.1 -20 %
Below average 0.2 -6
Average 0.4 17
Above average 0.2 40
Strong 0.1 65
1.0

Calculate the stocks expected return and standard deviation. Do not round intermediate calculations. Round your answers to two decimal places.

Expected return: %

Standard deviation: %

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

Step: 3

blur-text-image

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

Finance And Sustainability

Authors: William Sun, Celine Louche, Roland Perez

1st Edition

1780520921, 978-1780520926

More Books

Students also viewed these Finance questions