Question
There are three possible states of the world, the probabilities shown in the table below. Calculate the expected return and the standard deviation for Denmark
There are three possible states of the world, the probabilities shown in the table below. Calculate the expected return and the standard deviation for Denmark Industries, Inc. Show and label your work.
|
Possible Outcomes
| |||
|
| Weak | Average | Strong |
|
|
(probability = 50%)
|
(probability = 30%) |
(probability = 20%) |
|
Denmark Industries, Inc.
|
2%
|
6% |
16% |
- What is the expected return of Denmark Industries?
- What is the standard deviation of Denmark Industries?
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Derivative Products And Pricing The Das Swaps And Financial Derivatives Library
Authors: Satyajit Das
1st Edition
0470821647, 9780470821640
