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You own 1,100 shares of stock in Avondale Corporation. You will receive a $1.90 per share dividend in one year. In two years, the company

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You own 1,100 shares of stock in Avondale Corporation. You will receive a $1.90 per share dividend in one year. In two years, the company will pay a liquidating dividend of $60 per share. The required return on the company's stock is 20 percent. Suppose you want only $750 total in dividends the first year. What will your homemade dividend be in two years? (Do not round intermediate calculations and round your answer to the nearest whole dollar amount, e.g, 32.) Homemade dividend Suppose your expectations regarding the stock market are as follows: State of the Economy Probability HPR Boom 0.2 348 Normal growth 0.3 19 Recession 0.5 -14 S E)- )r ) 1 Var() p[r) - E(n)P 1 es SD(r)= VVar(r) Use above equations to compute the mean and standard deviation of the HPR on stocks. (Do no Round your answers to 2 decimal places.) Mean % Standard deviation

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