Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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- Computer the expected return given these three economic states, their likelihoods, and the potential returns. Economic State Probability Return Fast Growth 0.40 25% Slow Growth 0.55 12% Recession 0.05 -50% Multiple Choice ___ -4.3 percent ___ 14.1 percent ___ 19.1 percent ___ 29.0 percentarrow_forwardCalculate the standard deviation of this scenario Outcome 1: Recession. Probability = 40% . Return = 7.38%. Outcome 1: Recovery. Probability = 60%. Return = 17.27 %. Answer in % terms w/o % sign and to 4 decimal places (1.2345)arrow_forwardLO 5 Book Ms Based on the following information: State of Economy Depression Recession Normal Boom Probability of State of Economy 0.13 0.22 0.47 0.18 You received partial credit in the previous attempt. Rate of Return if State Occurs -0.108 0.056 0.127 0.208 Calculate the expected return. (Do not round intermediate calculations. Round the final answer to 2 decimal places.) Expected return 9.54% Calculate the standard deviation. (Do not round intermediate calculations. Round the final answer to 2 decimal places.) Standard deviation 5.58% marrow_forward
- Nikularrow_forwardConsider the following returns and states of the economy for TZ.Com.: Economy ProbabilityReturn Weak 15% Normal 50% Strong 35% -9% 2% 6% What is the standard deviation of TZ's returns? SET YOUR CALCULATOR TO FOUR DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE %. FOR EXAMPLE, IF YOUR ANSWER IS 7.7011% ENTER IT AS 7.70.arrow_forwardes Consider the following information: State of Economy Recession Boom Probability of State of Expected return Economy .28 72 Portfolio Return if State Occurs Calculate the expected return. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) -.13 .23 %arrow_forward
- q5- 8.2 Prove step by step working out no excelarrow_forwardState of Economy Bust Boom State of Economy Roll Bust Boom Ross Bust Boom Calculate the standard deviations for Roll and Ross by filling in the following table: (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 4 decimal places.) Probability of State of Economy Probability of State of Economy .50 .50 .50 .50 .50 .50 Return Deviation from Expected Return -0.1950 0.2000 Security Returns if State Occurs 0.0600 -0.0600 Roll -14% 25 Squared Return Deviation 0.0380 0.0380 0² = Ross (0.0036) 0.0036 0²= 18% 6 Product 19.5000 0.0600arrow_forwardNonearrow_forward
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