Question

In the next year, you expect ANZ shares have a 20% chance of earning 10 percent...

In the next year, you expect ANZ shares have a 20% chance of earning 10 percent return, a 50% chance of earning only 2 percent and a 30% chance of earning -10 percent. Based on this, what is the variance of ANZ's expected return?

A. 7.2110

B. 0.0052

C. 0.0000

D. 5.20%

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
For the coming year, Stock A has a 10% chance of losing 25%, a 20% chance...
For the coming year, Stock A has a 10% chance of losing 25%, a 20% chance of making 6%, a 60% chance of making 25% and a 10% chance of making 50%. What is Stock A’s expected return? A. 14.00% B. 18.70% C. 23.70% D. 26.50% If a stock has a 30% chance of losing 18%, a 40% chance of losing only 3%, and a 30% chance of making 15%, what is the expected return of this stock? A. -2.10%...
You anticipate that an investment has a 30% chance of earning a 20% return, a 40%...
You anticipate that an investment has a 30% chance of earning a 20% return, a 40% chance of earning a 5% return, and a 30% chance of earning 12%. What is the standard deviation of this investment?  Answer in percent form to two decimal places.
What is the standard deviation of a stock that has a 10 percent chance of earning...
What is the standard deviation of a stock that has a 10 percent chance of earning 18%, a 10 percent chance of making 11%, a 40 percent chance of making 5%, and a 40 percent chance of making 22%? A. 7.95% B. 13.70% C. 7.78% D. 13.05% You have $250,000 to invest in two stocks. Stock A has an expected return of 15% and stock B has an expected return of 8%. How much must you invest in each stock...
Calculate standard deviation Your investment has a 40% chance of earning a 15% rate of return,...
Calculate standard deviation Your investment has a 40% chance of earning a 15% rate of return, a 50% chance of earning a 10% rate of return, and a 10% chance of losing 3%. What is the standard deviation of this investment? A. 8.43% B. 5.14% C. 9.29% D. 7.59% Expected return and volatility of a portfolio An investor invests 70% of her wealth in a risky asset with an expected rate of return of 15% and a variance of 5%,...
1.Albury Company is adding a new assembly line at a cost of $8.5 million. The company...
1.Albury Company is adding a new assembly line at a cost of $8.5 million. The company expects the project to generate cash flows of $2 million, $3 million, $4 million, and $5 million over the next four years. Its cost of capital is 16 percent. What is the internal rate of return that Albury can earn on this project? (Round to the nearest percent.) HINT: Use a financial calculator or the Excel function: =IRR(values,[guess]) Select one: A. 18% B. 19%...
QUESTION 28 After some study of the economy, your forecast for next year is that a...
QUESTION 28 After some study of the economy, your forecast for next year is that a boom economy has a 30% chance of occurring, a neutral economy 50%, and a bust economy a 20% chance of occurring. You also estimate that a certain stock would have a return of 31% in a boom economy next year, 21% in a neutral economy , and -10% in a bust economy. The risk-free rate is 4.5%. What is the standard deviation of expected...
QUESTION 26 After some study of the economy, your forecast for next year is that a...
QUESTION 26 After some study of the economy, your forecast for next year is that a boom economy has a 30% chance of occurring, a neutral economy 50%, and a bust economy a 20% chance of occurring. You also estimate that a certain stock would have a return of 32% in a boom economy next year, 21% in a neutral economy , and -10% in a bust economy. The risk-free rate is 4.4%. What is the expected risk premium for...
You are considering adding a stock to your portfolio that has an equal chance of earning...
You are considering adding a stock to your portfolio that has an equal chance of earning four possible stock returns (all four have the same probability). The four possible returns are -10%, 5%, 20%, and 35%. What is the expected return and standard deviation for this stock?
After some study of the economy, your forecast for next year is that a boom economy...
After some study of the economy, your forecast for next year is that a boom economy has a 30% chance of occurring, a neutral economy 50%, and a bust economy a 20% chance of occurring. You also estimate that a certain stock would have a return of 31% in a boom economy next year, 16% in a neutral economy , and -14% in a bust economy. The risk-free rate is 4.4%. What is the standard deviation of expected returns for...
You expect that Bean Enterprises will have earnings per share of $2 for the coming year....
You expect that Bean Enterprises will have earnings per share of $2 for the coming year. Bean plans to retain all of its earnings for the next three years. For the subsequent two years, the firm plans on retaining 50% of its earnings. It will then retain only 25% of its earnings from that point forward. Retained earnings will be invested in projects with an expected return of 20% per year. If Bean?s equity cost of capital is 10%, then...