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The following table shows the probability distributions of Reynolds at the end of next year. Return Probability Reynolds 0.2 -18% 0.4 15% 0.3 24% 0.1

  1. The following table shows the probability distributions of Reynolds at the end of next year.

Return

Probability

Reynolds

0.2

-18%

0.4

15%

0.3

24%

0.1

33%

  1. Calculate the expected return and standard deviation for Reynolds.
  2. Draw the probability distribution of Reynolds, assuming the returns follow normal distribution. Indicate the area at which 2/3 of the time the returns of Reynolds would fall into.

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