Suppose that price of AAA stock at the end of next year depends on the state of the economy. The economy can have three states with the supplied probabilities and prices. What is the standard deviation of AAA’s returns if you purchase AAA today for $100? Also assume that AAA will pay a dividend of $10 at the end of the year. Enter your answer as a percent without the % sign. Round your final answer to 2 decimals.
Expansion |
Stable |
Recession |
|
Probability |
.25 |
.5 |
.25 |
Price in one year |
$130 |
$100 |
$80 |
Suppose that price of AAA stock at the end of next year depends on the state...
Suppose that price of AAA stock at the end of next year depends on the state of the economy. The economy can have three states with the supplied probabilities and prices. What is the standard deviation of AAA’s returns if you purchase AAA today for $100? Also assume that AAA will pay a dividend of $10 at the end of the year. Enter your answer as a percent without the % sign. Round your final answer to 2 decimals. Expansion...
Suppose that price of AAA stock at the end of next year depends on the state of the economy. The economy can have three states with the supplied probabilities and prices. What is your expected return if you purchase AAA today for $100? Also assume that AAA will pay a dividend of $10 at the end of the year. Enter your answer as a percent. Round your final answer to 2 decimals. What is the standard deviation of AAA’s returns...
Given the following end of year prices and states of the economy. Combine the following assets to form a portfolio with zero risk. A. What is the weight of AAA in your portfolio? B. What is the expected return of your portfolio? Enter your answer as a percent. Do not include the % sign. Round your answer to two decimals. Probability .25 .75 Price today Expansion Recession AAA 100 130 110 BBB 50 55 65
Given the following end of year prices and states of the economy. Combine the following assets to form a portfolio with zero risk. What is the expected return of your portfolio? Enter your answer as a percent. Do not include the % sign. Round your final answer to two decimals. Probability .25 .50 Price today Expansion Recession AAA 100 130 110 BBB 50 55 65
Given the following end of year prices and states of the economy. Combine the following assets to form a portfolio with zero risk. What is the weight of AAA in your portfolio? Enter your answer as a percent. Do not include the % sign. Round your answer to two decimals. Probability 1.25 .50 Price today Expansion Recession AAA 100 130 110 BBB 150 65
Given the following end of year prices and states of the economy. Combine the following assets to form a portfolio with zero risk. What is the weight of AAA in your portfolio? What is the expected return of the portfolio? Enter your answer as a percent. Round your answer to two decimals. Probability .25 .75 Price today Expansion Recession AAA 100 130 110 BBB 50 55 65
Today you buy 1 share of ABC Inc. at $100 per share. A year from now ABC will pay a dividend of $3 per share for sure. The price of ABC a year from now is uncertain and depends on the state of the economy. A year from now the economy will either be in a recession, a state of “normal" growth, or a boom with probabilities of 30%, 40%, and 30% respectively. After analyzing ABC you determine that the...
Please Show Work 0. Today you bought 100 shares of ABC Inc. at S100 per share. A year from now ABC will pay a dividend of $2 per share for sure. The price of ABC a year from now is uncertain and depends on the state of the economy. A year from now the economy will either be in a recession, a state of "normal" growth, or a boom with probabilities of 30%, 40%, and 30% respectively. After analyzing ABC...
Given the following information A. Estimate the monthly expected return of the AAA stock. B. Estimate the standard deviation of BBB stock’s monthly returns C. Estimate the monthly expected return of a portfolio of 40% AAA and 60% BBB. Assume you purchase these shares in July 2018 D. Estimate the standard deviation of a portfolio of 40% AAA and 60% BBB monthly returns Enter your answer as a percent. Do not include the % sign. Round your final answer to two decimals....
A stock has had the following year-end prices and dividends: Year Price Dividend 0 $ 14.75 — 1 16.93 $ .15 2 17.93 .24 3 16.43 .28 4 18.77 .29 5 21.88 .34 What are the arithmetic and geometric returns for the stock? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Omit the "%" sign in your response.) Arithmetic returns % Geometric returns %