Question

A stock's return has the following distribution:
Calculate the stock’s expected return and standard deviation. Do not round intermediate calculations. Round your answers to two decimal places. Expected return: % Standard deviation: % |

Answer #1

**Expected return**=Respective return*Respective
probability

=(0.1*-30)+(0.2*-10)+(0.4*16)+(0.2*35)+(0.1*65)

**=14.9%**

probability | Return | probability*(Return-Expected Return)^2 |

0.1 | -30 | 0.1(-30-14.9)^2=201.601 |

0.2 | -10 | 0.2*(-10-14.9)^2=124.002 |

0.4 | 16 | 0.4*(16-14.9)^2=0.484 |

0.2 | 35 | 0.2*(35-14.9)^2=80.802 |

0.1 | 65 | 0.1*(65-14.9)^2=251.001 |

Total=657.89% |

**Standard deviation**=[Total
probability*(Return-Expected Return)^2/Total probability]^(1/2)

**=25.65%(Approx).**

Expected Return: Discrete Distribution
A stock's return has the following distribution:
Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return if This
Demand Occurs (%)
Weak
0.1
-50%
Below average
0.2
-6
Average
0.4
9
Above average
0.2
30
Strong
0.1
75
1.0
Calculate the stock's expected return. Round your answer to two
decimal places.
%
Calculate the standard deviation. Round your answer to two
decimal places.
%

Expected Return: Discrete Distribution
A stock's return has the following distribution:
Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return if This
Demand Occurs (%)
Weak
0.1
-40%
Below average
0.2
-5
Average
0.4
15
Above average
0.2
30
Strong
0.1
50
1.0
Calculate the stock's expected return. Round your answer to two
decimal places.
%
Calculate the standard deviation. Round your answer to two
decimal places.
%

Expected Return: Discrete Distribution A stock's return has the
following distribution:
Demand for the Company's Products Weak Below Average Average
Above Average Strong
Probability of This Demand Occurring 0.1 5 0.4 0.2 0.1
Rate of Return if This Demand Occurs (%) -45% -5% 14% 40%
60%
Calculate the stock's expected return. Round your answer to two
decimal places. % Calculate the standard deviation. Round your
answer to two decimal places. %

Problem 6-05 Expected Return: Discrete Distribution A stock's
return has the following distribution: Demand for the Company's
Products Probability of This Demand Occurring Rate of Return if
This Demand Occurs (%) Weak 0.1 -30% Below average 0.2 -8 Average
0.4 15 Above average 0.2 35 Strong 0.1 75 1.0 Calculate the stock's
expected return. Round your answer to two decimal places. %
Calculate the standard deviation. Round your answer to two decimal
places. %

EXPECTED RETURN
A stock's returns have the following distribution:
Demand for the
Company's Products Probability of This
Demand Occurring Rate of Return If
This Demand Occurs
Weak 0.2 (34%)
Below average 0.1 (12)
Average 0.4 16
Above average 0.2 40
Strong 0.1 47
1.0
A.Calculate the stock's expected return. Round your answer to
two decimal places.
%
B.Calculate the stock's standard deviation. Do not round
intermediate calculations. Round your answer to two decimal
places.
%
C. Calculate the stock's...

EXPECTED RETURN
A stock's returns have the following distribution:
Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return If
This Demand Occurs
Weak
0.2
(24%)
Below average
0.2
(12)
Average
0.4
16
Above average
0.1
22
Strong
0.1
70
1.0
Calculate the stock's expected return. Round your answer to two
decimal places.
%
Calculate the stock's standard deviation. Do not round
intermediate calculations. Round your answer to two decimal
places.
%
Calculate the stock's coefficient of...

EXPECTED RETURN
A stock's returns have the following distribution:
Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return If
This Demand Occurs
Weak
0.1
(40%)
Below average
0.2
(9)
Average
0.4
15
Above average
0.1
28
Strong
0.2
71
1.0
Calculate the stock's expected return. Round your answer to two
decimal places.
%
Calculate the stock's standard deviation. Do not round
intermediate calculations. Round your answer to two decimal
places.
%
Calculate the stock's coefficient of...

Expected return
A stock's returns have the following distribution:
Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return If
This Demand Occurs
Weak
0.1
-26%
Below average
0.1
-13
Average
0.4
12
Above average
0.1
35
Strong
0.3
45
1.0
Calculate the stock's expected return. Round your answer to two
decimal places.
%
Calculate the stock's standard deviation. Do not round
intermediate calculations. Round your answer to two decimal
places.
%
Calculate the stock's coefficient of...

EXPECTED RETURN
A stock's returns have the following distribution:
Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return If
This Demand Occurs
Weak
0.1
(28%)
Below average
0.1
(13)
Average
0.5
12
Above average
0.1
35
Strong
0.2
52
1.0
Calculate the stock's expected return. Round your answer to two
decimal places.
15.8%
Calculate the stock's standard deviation. Do not round
intermediate calculations. Round your answer to two decimal
places.
%
Calculate the stock's coefficient of...

A stock's returns have the following distribution:
Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return If
This Demand Occurs
Weak
0.1
(50%)
Below average
0.1
(10)
Average
0.4
13
Above average
0.3
26
Strong
0.1
65
1.0
Assume the risk-free rate is 4%. Calculate the stock's expected
return, standard deviation, coefficient of variation, and Sharpe
ratio. Do not round intermediate calculations. Round your answers
to two decimal places.
Stock's expected return: %
Standard deviation: %
Coefficient of...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 26 minutes ago

asked 38 minutes ago

asked 50 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 2 hours ago

asked 2 hours ago

asked 2 hours ago

asked 3 hours ago

asked 3 hours ago

asked 3 hours ago