Based on the following information, what is the expected return?State ofEconomyRecessionNormalBoomMultiple Choice7.63%11.39%9.06%Probability of State Rate of Return ifof EconomyState Occurs.25- 9.30%.4410.80%.3121.40% O7.63%11.39%9.06%8.35%None of these is correct.

Based on the following information, what is the expected return? State of Economy Recession Normal Boom Multiple Choice 7.63% Probability of State Rate of Return if of Economy State Occurs .25 .44 .31 -9.308 10.80% 21.408

Based on the following information, what is the expected return? State of Economy Recession Normal Boom Multiple Choice 7.63% Probability of State Rate of Return if of Economy State Occurs .25 .44 .31 -9.308 10.80% 21.408

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

Based on the following information, what is the expected return?
State of
Economy
Recession
Normal
Boom
Multiple Choice
7.63%
11.39%
9.06%
Probability of State Rate of Return if
of Economy
State Occurs
.25
- 9.30%
.44
10.80%
.31
21.40%

O
7.63%
11.39%
9.06%
8.35%
None of these is correct.

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470 - 34 you have concluded that the following relationships are possible next year: economic status probability rate of return weak economy .15 -5% static economy .6 5% strong economy .25 15% What is your expected rate of return (E(RI)) for next year? a. 4.25% b 6% c. 6.25% d. 7.75% e. 8%
level of retu State of Economy Probability .40 .30 .30 Asset A 30% Boom Normal Recession Asset B 20% 15% -10% 0% -20%
% Return on T-Bills, Stocks and Market Index State of the economy Probability T-Bills Phillips Pay -up Rubber-made Market Index Recession 0.2 7 -22 28 10 -13 Below Average 0.1 7 -2 14.7 -10 1 Average 0.3 7 20 0 7 15 Above Average 0.3 7 35 -10 45 29 Boom 0.1 7 50 -20 30 43 Mean 7 16.9 2.07 19.60 15 Standard Deviation 0 23.4 15.62 18.92 17.71 Coefficient of Variation 0 1.39 7.55 0.97 1.18 Covariance with MP 0 0.04 -0.3 0.02 0.03 Correlation with Market Index 0 1 -1.0 0.69 1 Beta 0 1.32 -0.88 0.74 1 CAPM Req. Return 7 17.54 -0.02 12.89 15.0 Valuation (Overvalued/Undervalued/Fairly valued) Fairly valued Overvalued Undervalued Undervalued Fairly valued Nature of stock Defensive Aggressive Defensive Defensive Defensive Using the data generated plot the…
470 - 35 you have concluded that the following relationships are possible next year: economic status probability rate of return weak economy .15 -5% static economy .6 5% strong economy .25 15% What is the standard deviation of the rate of return for the one year period? a. .65 % b. 1.45% c. 4% d. 6.25% e. 6.4%
Compute the expected return given these three economic states, their likelihoods, and the potential returns: Economic State Probability Return Fast Growth 0.2 23% Slow Growth 0.6 14% Recession 0.2 −30% Multiple Choice 12.5 percent 7.5 percent 3.5 percent 7.0 percent
Ef 43.
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 percent
LO 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% m
Question is in the screen shot
Q222
Nikul
es 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 %

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