Question
Scenario Analysis. The common stock of leaning tower of PITA.Inc. a resturant chain will generate the following pay offs to investors next year. probability dividend
Scenario Analysis. The common stock of leaning tower of PITA.Inc. a resturant chain will generate the following pay offs to investors next year.
| probability | dividend | stock price | |
| boom | .3 | $5 | $195 |
| normal economy | .5 | 2 | 100 |
| recession | .2 | 0 | 0 |
The company goes out of business if a recession hits. Calculate the expected rate of return and standard deviation of Return to Leaning Tower of PITA shareholders. the stock is selling today for $90.
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International Trade Finance
Authors: Tarsem Bhogal, Arun Trivedi
2nd Edition
303024542X, 9783030245429
