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Anders is considering an investment in Bristol Inc. and has gathered the following information. If the expected standard deviation for a share of the firm's
- Anders is considering an investment in Bristol Inc. and has gathered the following information. If the expected standard deviation for a share of the firm's stock is 20.13%, what is the risk/return ratio (coefficient of variation)?
| State of the Economy | Probability of the State | Conditional Expected Return (Bristol Inc.) |
| Recession | .20 | -10% |
| Steady | .50 | 10% |
| Boom | .30 | 45% |
| a. | .8196 |
| b. | .096 |
| c. | 1.22 |
| d. | 1.73 |
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The Economics Of Money Banking And Financial Markets
Authors: Frederic S. Mishkin
12th Global Edition
1292268859, 978-1292268859
