Question
Assume you bought CBA share for $21 and expect that the prices will change in the future. The price changes in future and the probability
Assume you bought CBA share for $21 and expect that the prices will change in the future. The price changes in future and the probability states of the economy are provided in the table below. Calculate your expected return and standard deviation for holding the share for one year if dividend is expected to be 0.55 irrespective of economic condition. Show your work in detail.
| Economic states | Probability | Expected change in prices |
| poor | 25% | $15 |
| moderate | 34% | $25 |
| good | 41% | $29.5 |
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Investment Science
Authors: David G. Luenberger
1st International Edition
0195391063, 9780195391060
