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 0.2 (5)
Average 0.4 16
Above average 0.2 25
Strong 0.1 60
Calculate the stock's expected return, standard deviation, and coefficient of variation.© BrainMass Inc. brainmass.com June 4, 2020, 1:05 am ad1c9bdddf
Please refer attached file for complete solution. Formulas typed with the help of equation writer are missing here.
Demand Probability of demand Return Mean
P X P*X X-Mean (X-Mean)^2 ...
Solution describes the methodology to calculate expected return, standard deviation and coefficient of variation in the given case.