Question
Given the following information, calculate the expected value for Firm C's EPS. Data for Firms A and B are as follows: E(EPSA) = $5.10, and
Given the following information, calculate the expected value for Firm C's EPS. Data for Firms A and B are as follows: E(EPSA) = $5.10, and A = $3.60; E(EPSB) = $4.20, and B = $2.96. Do not round intermediate calculations. Round your answer to the nearest cent.
Probability
0.1 0.2 0.4 0.2 0.1
Firm A: EPSA ($1.65) $1.80 $5.10 $8.40 $11.85
Firm B: EPSB (1.20) 1.31 4.20 7.09 9.60
Firm C: EPSC (2.54) 1.35 5.10 8.85 12.74
E(EPSC): $
You are given that c = $4.10. Discuss the relative riskiness of the three firms' earnings using their respective coefficients of variation. Do not round intermediate calculations. Round your answers to two decimal places.
CV
A
B
C
The most risky firm is -Select-
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