Consider the following information:Probability ofState ofPortfolioReturn if StateState of EconomyEconomyOccursRecession.20-13Вoom.80.19Calculate the expected return. (Do not round intermediate calculations and enter youranswer as a percent rounded to 2 decimal places, e.g., 32.16.)Expected return% You own a stock portfolio invested 15 percent in Stock Q, 20 percent in Stock R, 30percent in Stock S, and 35 percent in Stock T. The betas for these four stocks are .79,1.23, 1.13, and 1.36, respectively. What is the portfolio beta? (Do not round intermediatecalculations and round your answer to 2 decimal places, e.g., 32.16.)Portfolio beta

Expected return is rate of return an investor can anticipate receiving on an investment. To find the…

Consider the following information: Probability of State of Portfolio Return if State State of Economy Economy Occurs Recession .20 -13 Вoom .80 19 Calculate the expected return. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return %

Consider the following information: Probability of State of Portfolio Return if State State of Economy Economy Occurs Recession .20 -13 Вoom .80 19 Calculate the expected return. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return %

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Consider the following information: State ofEconomy Probability of Stateof Economy Rate of Returnif State Occurs Recession .21 –.12 Normal .48 .14 Boom .31 .33 Calculate the expected return. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
You are given the following information: State of Economy Probability ofState of Economy Rate of ReturnIf State Occurs Depression .07 −.097 Recession .17 .067 Normal .42 .138 Boom .34 .219 Calculate the expected return. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return % Calculate the standard deviation. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Standard deviation %
Use the following information on states of the economy and stock returns to calculate the expected return for Dingaling Telephone: (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) State of Economy Probability ofState of Economy Security Returnif State Occurs Recession 0.30 -6.5 % Normal 0.55 9.0 Boom 0.15 16.6
You are given the following information: State ofEconomy Return onStock A Return onStock B Bear .112 −.055 Normal .105 .158 Bull .083 .243 Assume each state of the economy is equally likely to happen. a. Calculate the expected return of each stock. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. Calculate the standard deviation of each stock. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) c. What is the covariance between the returns of the two stocks? (A negative answer should be indicated by a minus sign, Do not round intermediate calculations and round your answer to 6 decimal places, e.g., .161616.) d. What is the correlation between the returns of the two stocks? (A negative answer should be indicated by a minus sign, Do not round intermediate calculations and round your answer to 4…
Consider the following information: State ofEconomy Probability ofState of Economy Rate of Returnif State Occurs Recession .44 −.13 Boom .56 .25 Calculate the expected return. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Based on the following information, what is the standard deviation of returns? State of Economy Probability of Stateof Economy Rate of Return ifState Occurs Recession .28 − .096 Normal .41 .111 Boom .31 .221
Following are three economic states, their likelihoods, and the potential returns: Economic State Probability Return Fast growth 0.24 33 % Slow growth 0.52 7 Recession 0.24 –40 Determine the standard deviation of the expected return. (Do not round intermediate calculations and round your answer to 2 decimal places.)
Consider the following returns and states of the economy for TZ.Com.: Economy Probability Return Weak 15% 2% Normal 50% 8% Strong 35% 15% What is the standard deviation of TZ's returns?
Consider the following information: \table[[State of,Probability of,\table[[Rate of Return],[if State Occurs]]],[,],[\table[[State of],[Economy]],Stock A,Stock B],[Recession,0.20,0.05,-0.20],[Normal,0.40,0.10,0.10],[Boom,0.40,0.13,0.25]] a. Calculate the expected return for the two stocks. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) \table[[,,],[Expected return for A,,%
Consider the following information: Calculate the expected return. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return
What is the (exact) nominal return on an investment that earns a real return of 14.7% while inflation is 7.4%? Enter your response, in percent (%), correct to TWO decimal places.
Suppose the returns on an asset are normally distributed. The historical average annual return for the asset was 5.7 percent and the standard deviation was 18.3 percent. a. What is the probability that your return on this asset will be less than –4.1 percent in a given year? Use the NORMDIST function in Excel® to answer this question. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What range of returns would you expect to see 95 percent of the time? (Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) c. What range of returns would you expect to see 99 percent of the time? (Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations…

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