# Coefficient of variation

Trying to figure out how a particular stock's return will vary depending on what will happen to the economy:

State of Probability of Stock's Expected Return

the Economy State Occurring if this State Occurs

Recession 0.10 -60%

Below Average 0.20 -10

Average 0.40 15

Above Average 0.20 40

Boom 0.10 90

What is the coefficient of variation on the company's stock?

(Use the expected rate of return and the population standard deviation to calculate the coefficient of variation. Please show all calculations.

https://brainmass.com/business/finance/finance-coefficient-variation-169800

#### Solution Preview

Coefficient of variation = standard deviation/expected return

Expected return = Sum (Probability X associated return)

Expected return = 0.1X-60% ...

#### Solution Summary

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