Question

A stock's returns have the following distribution:

Demand for theCompany's Products |
Probability of ThisDemand Occurring |
Rate of Return IfThis Demand Occurs |

Weak | 0.2 | (48%) |

Below average | 0.2 | (8) |

Average | 0.3 | 17 |

Above average | 0.2 | 28 |

Strong | 0.1 | 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 variation. Round your answer to two decimal places.

Answer #1

expected return=Respective return*Respective probabilities

=(0.2*-48)+(0.2*-8)+(0.3*17)+(0.2*28)+(0.1*71)=**6.6%**

Probability | Return | Probability*(REturn-mean)^2 |

0.2 | -48 | 0.2*(-48-6.6)^2=596.232 |

0.2 | -8 | 0.2*(-8-6.6)^2=42.632 |

0.3 | 17 | 0.3*(17-6.6)^2=32.448 |

0.2 | 28 | 0.2*(28-6.6)^2=91.592 |

0.1 | 71 | 0.1*(71-6.6)^2=414.736 |

Total=1177.64 |

SD=[Total Probability*(REturn-mean)^2/Total
Probability]^(1/2)

which is equal to

=**34.32%(Approx)**

**CV=**SD/mean

=(34.32/6.6)=**5.20(Approx).**

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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
(44%)
Below average
0.2
(8)
Average
0.3
11
Above average
0.3
40
Strong
0.1
74
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 variation. Round...

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 (38%)
Below average 0.1 (15)
Average 0.3 13
Above average 0.1 37
Strong 0.3 51
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 variation. Round...

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
(38%)
Below average
0.1
(14)
Average
0.3
14
Above average
0.2
38
Strong
0.2
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 variation. Round...

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
(48%)
Below average
0.4
(7)
Average
0.3
14
Above average
0.1
32
Strong
0.1
46
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 variation. Round...

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 (48%) Below average 0.2 (11)
Average 0.3 11 Above average 0.1 24 Strong 0.3 54 1.0 Assume the
risk-free rate is 2%. 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: %...

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Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return If
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0.1
(24%)
Below average
0.1
(13)
Average
0.3
12
Above average
0.3
29
Strong
0.2
48
1.0
Assume the risk-free rate is 3%. 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...

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Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return If
This Demand Occurs
Weak
0.1
(28%)
Below average
0.3
(9)
Average
0.3
12
Above average
0.2
28
Strong
0.1
67
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 coefficient of variation....

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Demand for the
Company's Products
Probability of This
Demand Occurring
Rate of Return If
This Demand Occurs
Weak
0.2
(36%)
Below average
0.1
(7)
Average
0.3
18
Above average
0.2
27
Strong
0.2
48
1.0
Assume the risk-free rate is 3%. 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: %
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