Question
Answer a.,b.,c, show all work Integrative: Expected return, standard deviation, and coefficient of variation Three assetsF, G, and Hare currently being considered by Perth Industries.
Answer a.,b.,c, show all work
Integrative: Expected return, standard deviation, and coefficient of variation Three assetsF, G, and Hare currently being considered by Perth Industries. The probability distributions of expected returns for these assets are shown in the following table.
Asset F Asset G Asset H j Prj Return, rj Prj Return, rj Prj Return, rj 1 0.10 40% 0.40 35% 0.10 40% 2 0.20 10 0.30 10 0.20 20 3 0.40 0 0.30 20 0.40 10 4 0.20 5 0.20 0 5 0.10 10 0.10 20
a. Calculate the expected value of return, r , for each of the three assets. Which provides the largest expected return?
b. Calculate the standard deviation, r, for each of the three assets returns. Which appears to have the greatest risk?
c. Calculate the coefficient of variation, CV, for each of the three assets returns. Which appears to have the greatest relative risk?
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