Sandra has another alternative that will enable him to invest P100,000 in Pfizer stocks. One year later, the expected market value of Pfizer, based on the state of the economy, is given below.

Probability are as follows:

Recession: 10%

Slowdown: 20%

Base/Average: 40%

Upturn: 20% Boom: 10%

Requirement:

1. What is the expected return of the Pfizer stock? Fill in the table above as you solve for this.

2. What is the variance of the rate of return?

3. What is the standard deviation?

4. What is the coefficient of variation?

EXP. RETURN (p.x r.) State of Economy Exp. Market Returns (r) Probability Value (p.) Recession 180,000 Slowdown 140,000 Base/Average 130,000 Upturn 90,000 Boom 80,000 Expected Return