Question
You are an optimistic investor and bought shares of ABC for $17 andexpect that the prices will change in the future. The price changes in
You are an optimistic investor and bought shares of ABC for $17 andexpect that the prices will change in the future. The price changes in future and the probability states of the economy is provided in the table below. Calculate your expected return and standard deviation for holding the share for one year if dividend is expected to be 0.40 irrespective of economic condition. Show your work in detail.
Economic states
Probability
Expected change in prices
poor
35%
$8.5
moderate
25%
$15.8
good
45%
$19.5
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Essentials Of Business Statistics Communicating With Numbers
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