Senior management of Nancy’s Nooks (NN) has determined that there is a 20 percent chance EPS will be $4.50 next year, there is a 60 percent chance EPS will be $1.50, and there is 20 percent chance EPS will be -$1.80. Calculate the following: (a) Expected value (b) Standard deviation (c) Coefficient of variation

EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter12: Capital Structure
Section: Chapter Questions
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Senior management of Nancy’s Nooks (NN) has determined that there is a 20 percent chance EPS will be $4.50 next year, there is a 60 percent chance EPS will be $1.50, and there is 20 percent chance EPS will be -$1.80.

Calculate the following:

(a) Expected value

(b) Standard deviation

(c) Coefficient of variation

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