(c) Hairul is considering to buy the ordinary shares of One Berhad and Two Berhad. The possible returns for the companies' shares next year are as follows: State of economy Normal Growth Probability 0.4 0.6 Rate of return (r) One Berhad % 20 25 ii. Calculate the variance for each share Two Berhad % iii. Calculate the standard deviation of each share. 19 i. Calculate the expected return of the shares. 28

(c) Hairul is considering to buy the ordinary shares of One Berhad and Two Berhad. The possible returns for the companies' shares next year are as follows: State of economy Normal Growth Probability 0.4 0.6 Rate of return (r) One Berhad % 20 25 ii. Calculate the variance for each share Two Berhad % iii. Calculate the standard deviation of each share. 19 i. Calculate the expected return of the shares. 28

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 3P

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