The table below shows the one-year return distribution for RCS stocks.
Possible Return Ri |
Probability pi |
-40% | 0.10 |
-20% | 0.20 |
0% | 0.15 |
20% | 0.25 |
40% | 0.30 |
(a) The expected return is: %. (Round to two decimal places.)
(b) The standard deviation is: %. (Round to two decimal places.)
Probability (P) | RETURN (Y) | (P * Y ) | P * (Y -Average Return of Y)^2 | |
10% | -40 | -4.00 | 240.10 | |
20% | -20 | -4.00 | 168.20 | |
15% | 0 | 0.00 | 12.15 | |
25% | 20 | 5.00 | 30.25 | |
30% | 40 | 12.00 | 288.30 | |
TOTAL | 9.00 | 739.00 | ||
Expected Return = | (P * Y) | |||
9.00% | ||||
VARIANCE = | P * (Y -Average Return of Y)^2 | |||
739.0000 | ||||
Standard Deviation = | Square root of (P * (Y -Average Return of Y)^2) | |||
Square root of 739 | ||||
27.18 |
The table below shows the one-year return distribution for RCS stocks. Possible Return Ri Probability pi...
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