Your rate of return expectations for the stock of Gidimadjor Company during the next year are Possible Rate of Return (kk) Possible Rate of Return Probability (Gidimadjor Itd) -0.60 0.56 0.15 -0.30 0.36 0.10 -0.10 -0.08 0.05 0.20 0.02 0.40 0.40 0.33 0.20 0.80 0.51 0.10 a. Compute the expected return [E(Ri)] on this stock, the variance (o2) of this return, and its d. Compute the coefficients of variation (CVs) for KK Itd and Gidimadjor and discuss which stock return series has the greater relative dispersion.

Algebra & Trigonometry with Analytic Geometry
13th Edition
ISBN:9781133382119
Author:Swokowski
Publisher:Swokowski
Chapter10: Sequences, Series, And Probability
Section10.2: Arithmetic Sequences
Problem 68E
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QUESTION 1
Your rate of return expectations for the stock of Gidimadjor Company during the next
year are
Possible Rate of Return (kk) Possible Rate of Return
Probability
(Gidimadjor Itd)
-0.60
0.56
0.15
-0.30
0.36
0.10
-0.10
-0.08
0.05
0.20
0.02
0.40
0.40
0.33
0.20
0.80
0.51
0.10
a. Compute the expected return [E(Ri)] on this stock, the variance (02) of this return, and its
d. Compute the coefficients of variation (CVs) for KK Itd and Gidimadjor and discuss which
stock return series has the greater relative dispersion.
Transcribed Image Text:QUESTION 1 Your rate of return expectations for the stock of Gidimadjor Company during the next year are Possible Rate of Return (kk) Possible Rate of Return Probability (Gidimadjor Itd) -0.60 0.56 0.15 -0.30 0.36 0.10 -0.10 -0.08 0.05 0.20 0.02 0.40 0.40 0.33 0.20 0.80 0.51 0.10 a. Compute the expected return [E(Ri)] on this stock, the variance (02) of this return, and its d. Compute the coefficients of variation (CVs) for KK Itd and Gidimadjor and discuss which stock return series has the greater relative dispersion.
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