Homework Answers
expected percentage return :[return *probability]
[12 *.30 ] +[16*.50 ]+[19*.20]
3.6+ 8+ 3.8
= 15.4%
correct option is "B"
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12) Assume that an investment is forecasted to produce the following returns: a 30% probability of...
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of...
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of a 12% return; a 50% probability of a 16% return; and a 30% probability of a 19% return. What is the standard deviation of return for this investment? A) 5.89% B) 16.1% C) 2.43% D) 15.7% 6. Answer the questions below using the following information on stocks A, B, and C. Expected Return Standard Deviation Beta 20% 12% 1.8 21% 10% 2.2 10% 10%...
Can you explain?I am getting different numbers from provided answer 5. Assume that an investment is forecasted to produ...
Can you explain?I am getting different numbers from provided
answer
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of a 12% return; a 50% probability of a 16% return; and a 30% probability of a 19% return What is the standard deviation of return for this investment? A) 5.89% B) 16.1% C) 2.43% D) 15.7% Answer: C
D) $17.450 6) For a given stated interest rate, an investor would receive a greater future...
D) $17.450 6) For a given stated interest rate, an investor would receive a greater future value with daily compounding as opposed to monthly compounding TRUD OR FALSE *7) An investment is expected to yield $300 in three years, 5500 in five years, and $300 in seven years. What is the present value of this investment if our opportunity rate is 5%? A) $735 B) $864 C) $885 D) $900 *8) What is the present value of $1,000 per year...
I am unsure how the answer is "C" and not "B". Please help me solve this....
I am unsure how the answer is "C" and not "B". Please help me
solve this. Using a financial calculator if possible.
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of a 12% retum; a 50% probability of a 16% retum; and a 30% probability of a 19% return What is the standard deviation of return for this investment? A) 5.89% B) 16.1% C) 2.43% D) 15.7% Answer: C
Possible Returns Probability Investment Investment Y .05 -10% 0% 5% 5% 20% 16% 25 30% 24%...
Possible Returns Probability Investment Investment Y .05 -10% 0% 5% 5% 20% 16% 25 30% 24% .05 40% 32% Calculate the expected return and standard deviation for each investment. Find the standard deviation manually Upload your work to receive credit. Probability Returns .40 7% 4% 18% 10%
Returns for Stocks A and Stock B have the following distribution: Probability Rate of Return Stock...
Returns for Stocks A and Stock B have the following distribution: Probability Rate of Return Stock A Rate of Return Stock B 0.20 +16% -10% 0.30 +10% -6% 0.50 -30% +40% a) What is the Expected Return for Stock A? b) What is the Standard Deviation for Stock A? c) What is the Expected Return for Stock B? d) What is the Standard Deviation for Stock B? e) What is the Expected Return for a Portfolio with an equal 50%...
a. Calculate the expected return for each security. b. Calculate the standard deviation of returns for...
a. Calculate the expected return for each security.
b. Calculate the standard deviation of returns for each
security.
c. Compare Stock A with Stocks B and C. Is Stock A preferred
over the others?
d. Using your result in parts a and b, compute the following
probabilities:
Stock A makes a return more than 18.9%
Stock B makes a return less than 1.3%
Stock C makes a return between 6.1% and 16.1%
2) You are considering the...
You plan to make an investment. given the following probability distribution of returns, what is the...
You plan to make an investment. given the following probability distribution of returns, what is the expected return on the investment ? if the standard deviation of the return is $77,460, what is the CV of the investment ? market condition probability profit $000' good 30% 300 normal 40% 200 bad 30% 100
Two stocks under evaluation have the following probability distribution for their rate of returns. Probability 30%...
Two stocks under evaluation have the following probability distribution for their rate of returns. Probability 30% 20% 50% Rate of Return Stock A Stock B 18% 10% -2% 5% 10% 0% Table Q1 (a) Explain the expected return for each of the stocks by giving the value. (3 marks) (b) Explain the standard deviation for the return of each of the stocks by giving the value. (6 marks) (c) Explain the correlation coefficient between the returns of the two stocks...
Assume that you expect to hold a $20,000 investment for one year. It is forecasted to...
Assume that you expect to hold a $20,000 investment for one year. It is forecasted to have a year end value of $21,000 with a 30% probability; a year end value of $24,000 with a 45% probability; and a year end value of $30,000 with a 25% probability. What is the standard deviation of the holding period return for this investment?
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of a 12% return; a 50% probability of a 16% return; and a 30% probability of a 19% return. What is the standard deviation of return for this investment? A) 5.89% B) 16.1% C) 2.43% D) 15.7% 6. Answer the questions below using the following information on stocks A, B, and C. Expected Return Standard Deviation Beta 20% 12% 1.8 21% 10% 2.2 10% 10%...
Can you explain?I am getting different numbers from provided
answer
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of a 12% return; a 50% probability of a 16% return; and a 30% probability of a 19% return What is the standard deviation of return for this investment? A) 5.89% B) 16.1% C) 2.43% D) 15.7% Answer: C
D) $17.450 6) For a given stated interest rate, an investor would receive a greater future value with daily compounding as opposed to monthly compounding TRUD OR FALSE *7) An investment is expected to yield $300 in three years, 5500 in five years, and $300 in seven years. What is the present value of this investment if our opportunity rate is 5%? A) $735 B) $864 C) $885 D) $900 *8) What is the present value of $1,000 per year...
I am unsure how the answer is "C" and not "B". Please help me
solve this. Using a financial calculator if possible.
5. Assume that an investment is forecasted to produce the following returns: a 20% probability of a 12% retum; a 50% probability of a 16% retum; and a 30% probability of a 19% return What is the standard deviation of return for this investment? A) 5.89% B) 16.1% C) 2.43% D) 15.7% Answer: C
Possible Returns Probability Investment Investment Y .05 -10% 0% 5% 5% 20% 16% 25 30% 24% .05 40% 32% Calculate the expected return and standard deviation for each investment. Find the standard deviation manually Upload your work to receive credit. Probability Returns .40 7% 4% 18% 10%
a. Calculate the expected return for each security.
b. Calculate the standard deviation of returns for each
security.
c. Compare Stock A with Stocks B and C. Is Stock A preferred
over the others?
d. Using your result in parts a and b, compute the following
probabilities:
Stock A makes a return more than 18.9%
Stock B makes a return less than 1.3%
Stock C makes a return between 6.1% and 16.1%
2) You are considering the...
Two stocks under evaluation have the following probability distribution for their rate of returns. Probability 30% 20% 50% Rate of Return Stock A Stock B 18% 10% -2% 5% 10% 0% Table Q1 (a) Explain the expected return for each of the stocks by giving the value. (3 marks) (b) Explain the standard deviation for the return of each of the stocks by giving the value. (6 marks) (c) Explain the correlation coefficient between the returns of the two stocks...
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