Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Four analysts cover the stock of Fluorine Chemical. One forecasts a 4% return for the coming year. The second expects the retum to be -

image text in transcribed

Four analysts cover the stock of Fluorine Chemical. One forecasts a 4% return for the coming year. The second expects the retum to be - 5%. The third predicts a retum of 10%. The fourth expects a 1% return in the coming year. You are relatively confident that the retum will be positive but not large, so you arbitrarily assign probabilities of being correct of 26%, 6%, 17%, and 51%, respectively, to the analysis forecasts. Given these probabilities, what is Fluorine Chemical's expected return for the coming year? Fluorine Chemical's expected return for the coming year is %. (Round to two decimal places.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Green And Sustainable Finance

Authors: Simon Thompson

2nd Edition

1398609242, 978-1398609242

More Books

Students also viewed these Finance questions