Solve: For the Expected Return
Not what you're looking for?
Please see the attached word document to view the expected return problems.
Any assistance would be appreciated.
Consider the following information:
Rate of Return If State Occurs
State of Probability of ________________________________________
Economy State of Economy Stock A Stock B
Recession 0.17 0.05 − 0.21
Normal 0.62 0.09 0.08
Boom 0.21 0.16 0.25
________________________________________
Calculate the expected return for the two stocks. (Round your answers to 2 decimal places. (e.g., 32.16))
Expected return
Stock A %
Stock B %
________________________________________
Calculate the standard deviation for the two stocks. (Do not round intermediate calculations and round your final answers to 2 decimal places. (e.g., 32.16))
Standard deviation
Stock A %
Stock B %
Purchase this Solution
Solution Summary
The expected return and standard deviations for the two stocks are given.
Solution Preview
Expected return of A = 0.17 X 0.05 + 0.62 X 0.09 + 0.21 X 0.16 = 0.0979
Expected return of B = 0.17 X -0.21 + 0.62 X 0.08 + ...
Purchase this Solution
Free BrainMass Quizzes
Basics of corporate finance
These questions will test you on your knowledge of finance.
Six Sigma for Process Improvement
A high level understanding of Six Sigma and what it is all about. This just gives you a glimpse of Six Sigma which entails more in-depth knowledge of processes and techniques.
Income Streams
In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.
Business Processes
This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.
Transformational Leadership
This quiz covers the topic of transformational leadership. Specifically, this quiz covers the theories proposed by James MacGregor Burns and Bernard Bass. Students familiar with transformational leadership should easily be able to answer the questions detailed below.