Compute the standard deviation of the expected return given these three economic states, their likelihoods, and the potential returns: Economic State Probability Return Fast Growth 0.2 30% Slow Growth 0.5 6% Recession 0.3 −2%

Q: Consider the following information: Probability of State of Economy State of Economy Recession Boom…

A: Probability of Recession = 0.29Probability of Boom = 0.71Return under Recession = -0.09Return under…

Q: You have the following stock with expected returns given the different economic outcomes. What is…

A: The return that we expect from a stock is not guaranteed. The expected returns figure will vary…

Q: Following are three economic states, their likelihoods, and the potential returns:   Economic State…

A: A standard deviation (or  σ ) is a measure of how spread out the data is with respect to the mean.

Q: Following are three economic states, their likelihoods, and the potential returns: Economic State…

A: First, determine the expected value of the distribution using the formula E(X)=∑X⋅P(X) as shown…

Q: Assume that you are given the following historical returns for the Market and Security J. Also…

A: To find out the expected return of security J for coming year as per CAPM, we are required to find…

Q: Consider the following information: State of Economy Recession Boom Probability of State of Economy…

A: State of economyProbabilityRate of return if state occursRecession0.39-0.13Bust0.610.25

Q: You have the below information about the expected returns of Palantir Technologies and Valar…

A: Given: Economic Probability(P) Palantir technologies Valar Ventures Boom 0.1 21% 39% Normal…

Q: live in a world where three future states are pos these states of the economy. State Probability om…

A: Expected rate is the weighted rate of return based on the probability of happening the event over…

Q: Consider the following information: State of Economy Recession Boom Probability of State of Economy…

A: The expected return refers to the weighted average profits that the investment provides after…

Q: c. If the historical annual returns of an Investment in various Economic Conditions (with their…

A: Expected return on the investment = (Poor condition return x Probability) + (Normal condition return…

Q: Consider the following information for the next year's return on IBM. probability return 10% 20% 0.8…

A: The profit or loss that an investor predicts on an investment with known historical rates of return…

Q: Bhupendra

A: Here's how you can calculate the expected return and the standard deviation of returns:Expected…

Q: Consider the following information about the various states of economy and the returns of various…

A: The total probable returns of any stock indicate its mean return. Any stock's volatility and the…

Q: Barbara Millicent Roberts LLC (BMRL) is a boutique advisory firm that specialises in macro- economic…

A: The CAPM model refers to the relationship that exists between the expected return of the stock and…

Q: Assume you are given the following information regarding the expected returns for an asset, for…

A: Formulas used: Expected return = Sum of (Probability of state* Return in that state) Standard…

Q: Consider the following information: Probability of State of Economy State of Economy Recession .20…

A: State of Economy Probability of State of Economy Rate of return if state Occurs Recession 0.2…

Q: 2. Given the following historical returns, calculate the average return and the standard deviation:…

A: standard deviation = square root of (sum of (Return-average)^2)

Q: Based on the following information, what is the standard deviation of returns? State of Economy…

A: The standard deviation shows the average volatility in the returns of the stock.It shows to what…

Q: Following are four economic states, their likelihoods, and the potential returns:   Economic State…

A: The expected return of a stock is the average return that the stock provides based on market…

Q: Consider the following information: State of Economy Recession Boom Probability of State of Economy…

A: Expected return = Sum of ( Rate of return x Probability of the return)=>Expected return =(Rate of…

Q: Dr. Sumaya Ali wish to invest in Asset A and Asset B for three different state like Boom, Normal and…

A: Expected return is the average sum of all the expected returns from an investment or project. It is…

Q: Use the following information to answer the question. Probability Outcome Return Recession 20% -20%…

A: Expected return is sum of Probability * return in all outcomes.

Q: Consider the following information: State of Economy Recession Normal Boom Probability of State of…

A: The expected return using probabilities is calculated using following equation Expected return =…

Q: None

A: Step 1: Initial Scenario:State of Economy:Fast growth: 0.11 probability, 35% returnSlow growth: 0.50…

Q: Expected Return:  Please compute the expected return given these three economic states, their…

A: expected return = sum of probability*return

Q: Probability of State of Economy State of Economy Recession .20 Normal .50 Boom .30 Iculate the…

A: Returns from stock investments depend on market conditions and the market conditions change due to…

Q: Expected return

A: Expected Return is the amount of loss or profit an investor expects to receive on an investment. It…

Q: a 0.07248 b. 0.00386 0.26921

A: Portfolio management is the process of selecting, prioritising, and controlling an organization's…

Q: Compute the expected return given these three economic states, their likelihoods, and the potential…

A: Probability Return 0.3 40% 0.4 15% 0.3 -15%

Q: State of the Economy Deep recession Mild recession Average Mild boom Strong boom Probability 0.05…

A: Correlation Correlation between the returns of stock A and B is calculated as shown below.…

Q: Consider the following information: State of Economy Recession Normal Boom Probability of State of…

A: Expected return is determined by weighing the potential outcomes of an investment against their…

Q: Expected return and standard deviation. Use the following information to answer the questions.…

A: Given:

Q: Use the following information to calculate your company's expected return. State…

A: Expected return refers to the investor’s predicted amount of profit and loss on an investment.…

Q: Use the following information to answer the question.    Based on above data, determine the…

A: Given information : Outcome  Probability  Return Recession  20% -20% Expansion 25% 15% Boom…

Q: Consider the following information:   State of Economy Probability of State of Economy Rate of…

A: In the case of probabilistic data, return is calculated by multiplying each return by its respective…

Q: Using the equation g = b x ROE will always result in the correct growth rate for future periods.…

A: The sustainable growth rate measures the greatest rate at which a business may expand its revenue,…

Q: EXERCISE 2 From the data below, find the following: [al expected return [b] Standard deviation [c]…

A: In the case of multiple sub-parts, as per the guidelines, only three subparts are allowed to be…

Q: Consider the following information: State of Economy Recession Normal Boom Probability of State of…

A: The expected return is the estimation of profit or loss that an investor determine from his…

Q: What is the risk premium for the following returns if the risk-free rate is 4%?   State…

A: State Probability Return Boom .25 .25 Good .50 .10 Recession .25 0…

Q: Consider the following information: State of Economy Recession Normal Boom Probability of State of…

A: The expected return refers to the return the investment provides on average to the investors. It…

Q: Use the following information on states of the economy and stock returns to calculate the expected…

A: An expected return is calculated by multiplying potential outcomes by the there probabilities

Q: Compute the expected return given these three economic states, their likelihoods, and the potential…

A: The expected return refers to the return that the investment provides on average to the investors.…

Q: Following are four economic states, their likelihoods, and the potential returns: Economic State…

A: In the given case, we have provided the each sate of economy and their respective probabilities and…

Q: Computer the expected return given these three economic states, their likelihoods, and the potential…

A: >Expected return is the rate of return that is expected to be earned on the prospective…

Q: Consider the following information: State of Economy Probability of State of Rate of Return if State…

A: Formulae of Exp return = Probability  of occurence * return on occurence Therefore the cumulative…

Q: You have the below information about the expected returns of Lembas LLC, Rivendell LCC, and Arda…

A: A combination of the different types of funds and securities for the investment is term as the…

Q: 1 Given the following historical prices calculate a distribution of possible prices for the next…

A: A financial statistic called Value at Risk (VaR) calculates an investment's risk. VaR, as employed…

Q: You own a portfolio with the following expected returns given the various states of the economy.…

A: Expected return refers to the probability of expected return from all the scenarios.