You estimate that AE Corp has a 20% chance of generating 30% returns, a 20% chance of generating -40% returns, and a 60% chance of generating 10% returns. What are the expected returns and standard deviation of AE Corp?

Acme Inc. plans to pay a $1/share dividend on a quarterly basis. What is the price of their shares given a 12% annually compounded cost of capital? What if the firm plans to increase its dividend by 5% every yea