stock's returns have the following distribution: emand for the Probability of This ompany's Products Demand Occurring eak elow average Rate of Return If This Demand Occurs 0.1 0.2 0.4 0.1 0.2 1.0 Calculate the stock's expected return. Round your answer to two decimal places. % werage bove average trong (44%) (13) 17 26 52

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter8: Analysis Of Risk And Return
Section: Chapter Questions
Problem 17P
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EXPECTED RETURN
A stock's returns have the following distribution:
Demand for the
Company's Products
Weak
Below average
Average
Above average
Strong
Probability of This
Demand Occurring
Rate of Return If
This Demand Occurs
0.1
0.2
0.4
0.1
0.2
1.0
a. Calculate the stock's expected return. Round your answer to two decimal places.
%
(44%)
(13)
17
26
52
b. Calculate the stock's standard deviation. Do not round intermediate calculations. Round your answer to two decimal places.
%
c. Calculate the stock's coefficient of variation. Round your answer to two decimal places.
Transcribed Image Text:EXPECTED RETURN A stock's returns have the following distribution: Demand for the Company's Products Weak Below average Average Above average Strong Probability of This Demand Occurring Rate of Return If This Demand Occurs 0.1 0.2 0.4 0.1 0.2 1.0 a. Calculate the stock's expected return. Round your answer to two decimal places. % (44%) (13) 17 26 52 b. Calculate the stock's standard deviation. Do not round intermediate calculations. Round your answer to two decimal places. % c. Calculate the stock's coefficient of variation. Round your answer to two decimal places.
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