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Finding the Expected Return Value and Standard Deviation Giv

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The expected value and the standard deviation of returns for asset A is

Possible Outcomes Probabilities Returns(%)
Pessimistic .25 10
Most Likely .45 12
Optimistic .30 16

A) 12.7 percent and 2.3 percent
B) 12 percent and 4 percent
C) 12.7 percent and 4 percent
D) 12 percent and 2.3 percent.

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Solution Summary

This solution illustrates how to find the expected return value and standard deviation of the expected return value given probabilities.

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