Question
The following data represent the probability distribution of the holding period returns for an investment in Lazy Rapids Kayaks (LARK) stock. State of the Economy
The following data represent the probability distribution of the holding period returns for an investment in Lazy Rapids Kayaks (LARK) stock.
| State of the Economy | Scenario #(s) | Probability, p(s) | HPR |
| Boom | 1 | 0.340 | 33.20% |
| Normal growth | 2 | 0.420 | 8.40% |
| Recession | 3 | 0.24 | -19.20% |
a. What is the expected return on LARK? (Round your answer to 2 decimal places.)
Expected return %
b. What is the standard deviation of the returns on LARK? (Round your answer to 2 decimal places.)
Standard deviation %
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The Handbook Of Fixed Income Securities
Authors: Frank Fabozzi, Steven Mann
8th Edition
0071768467, 978-0071768467
