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An investment's return can rise or fall depending on different factors. Assume that you are planning to invest Rs. 1,000 in stock market and you
An investment's return can rise or fall depending on different factors. Assume that you are planning to invest Rs. 1,000 in stock market and you are aware that economy can either have normal growth or it will boom or fall to recession. Considering these economic conditions; you are expected to get following stock market return: Requirements: a. Calculate percentage expected rate of return of Rs. 1,000 investment over the coming year. b. Calculate expected value of Rs. 1,000 investment. c. Calculate variance and standard deviation. d. What will be the risk premium If risk-free return is 6 percent
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