Assume that S(0) = 100, the current price of the stock, and that the ex dividend price is: (80 with probability | 90 with probability S(1) = 100 with probability (110 with probability The company will pay out a constant dividend D (independent of the future stock price). Compute D for which the expected return on stock would be 18% Formulae E(S(1))+D-S(O), and where D=0=k=" (0) 30) Var(K) = 0= (50)? Var(S(1)) Sharp Ratio"; "y CML: x = ["07" xo] +r; Covariance:Cov(X.Y) = OXY = E(X-E(X)(Y-E(Y)) = E(XY) - E(X)EY N - 1 Portfolio mean: Hp = wifi + w2|12,where wi+w2 = 1 Portfolio variance: 0= wio + wzoz +201,2W1 W20102 Correlation coefficient: pxy =