Mr. Ali owns a company. There is a 30% probability that his Company's sales will be $15 million next year, 35% probability that they will be $ 8 million, and a 35% probability that they will be $5 million. a) What are the expected sales of Ali’s Company next year? b) What is the standard deviation of Ali’s Company next year's sales?

Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
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Chapter7: Corporate Valuation And Stock Valuation
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Problem 1P: Ogier Incorporated currently has $800 million in sales, which are projected to grow by 10% in Year 1...
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Mr. Ali owns a company. There is a 30% probability that his Company's sales will be $15 million next year, 35% probability that they will be $ 8 million, and a 35% probability that they will be $5 million.
a) What are the expected sales of Ali’s Company next year?
b) What is the standard deviation of Ali’s Company next year's sales?

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