Raghubhai DW Co. stock has an annual return mean and standard deviation of 12 percent and 41percent, respectively. What is the smallest expected loss in the coming year with aprobability of 5 percent? (A negative value should be indicated by a minus sign. Do notround intermediate calculations. Round the z-score value to 3 decimal places whencalculating your answer. Enter your answer as a percent rounded to 2 decimal places.)Smallest expected loss%

Step 1: State the given: population mean, µ = 12%population standard deviation, σ = 41% Step 2:…

Answered: DW Co. stock has an annual return mean…

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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If the return on stock A in year 1 was 10 %, in year 2 was -6 %, in year 3 was -2 % and in year 4 was 10 %, what was the standard deviation of returns for stock A over this four year period? (Round your answer to 1 decimal place and record without a percent sign. If your final answer is negative, place a minus sign before the number with no space between the sign and the number).
The common stock of Manchester & Moore is expected to earn 14.8 percent in a recession, 8 percent in a normal economy, and lose 5.8 percent in a booming economy. The probability of a boom is 12 percent while the probability of a recession is 6 percent. What is the expected rate of return on this stock? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
You find a certain stock that had returns of 16 percent, −23 percent, 24 percent, and 9 percent for four of the last five years. The average return of the stock over this period was 10.2 percent. a. What was the stock’s return for the missing year? (Do not round intermediate calculations and enter your answer as a percent rounded to 1 decimal place, e.g., 32.1.) b. What is the standard deviation of the stock’s returns? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
You’ve observed the following returns on Pine Computer’s stock over the past five years: −26.4 percent, 14.6 percent, 32.2 percent, 2.8 percent, and 21.8 percent. What was the arithmetic average return on the stock over this five-year period? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. What was the variance of the returns over this period? Note: Do not round intermediate calculations and round your answer to 6 decimal places, e.g., .161616. What was the standard deviation of the returns over this period? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
You’ve observed the following returns on Yamauchi Corporation’s stock over the past five years: –28.2 percent, 15.8 percent, 34.6 percent, 3.4 percent, and 22.4 percent. a. What was the arithmetic average return on the stock over this five-year period? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What was the variance of the returns over this period? (Do not round intermediate calculations and round your answer to 6 decimal places, e.g., 32.161616.) c. What was the standard deviation of the returns over this period? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
The rate of return on General Electric common stock over the coming year is normally distributed with an expected value of 15 percent and a standard deviation of 12 percent. Determine the probability of earning a negative rate of return.
The common stock of Air United, Inc., had annual returns of 15.6 percent, 2.4 percent, -11.8 percent, and 32.9 percent over the last four years, respectively. What is the standard deviation of these returns? Group of answer choices 13.29 percent 14.14 percent 16.50 percent 17.78 percent 19.05 percent show your work please and let me know if we can solve it by financial calculator
You’ve observed the following returns on Pine Computer’s stock over the past five years: 13 percent, −13 percent, 20 percent, 25 percent, and 10 percent. a. What was the arithmetic average return on the company’s stock over this five-year period? (Do not round intermediate calculations and enter your answer as a percent rounded to 1 decimal place, e.g., 32.1.) b-1. What was the variance of the company’s returns over this period? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., .16161.) b-2. What was the standard deviation of the company’s returns over this period? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Average return % b-1. Variance b-2. Standard deviation %
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An index model regression applied to past monthly returns in Ford’s stock price produces the following estimates, which are believed to be stable over time: rF = 0.1% + 1.1rM If the market index subsequently rises by 7.3% and Ford’s stock price rises by 7%, what is the abnormal change in Ford’s stock price? (Negative value should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.).
You’ve observed the following returns on Yasmin Corporation’s stock over the past five years: 15 percent, –6 percent, 18 percent, 14 percent, and 10 percent. a. What was the arithmetic average return on the company's stock over this five-year period? (Do not round intermediate calculations. Enter your answer as a percent rounded to 1 decimal place, e.g., 32.1.) Average return % b-1 What was the variance of the company's stock returns over this period? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., 32.16161.) Variance b-2 What was the standard deviation of the company's stock returns over this period? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Standard deviation %
A company has a beta of 1.4, the T-bill rate is 2.09%, and the expected return on the market is 9.02%. What is its required rate of return? Do not round your intermediate calculations. Express as a percent rounded to two decimal places.

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