In excel form Consider the following information given toanswer the series of questions below todetermine the preferred investment usingthe measurement for a stand alone risk.Probability of thisDemand occurringDemand for theRate of Return on stockCompany's Productsif this Demand occursStock AStock BStock CHighly FavorableFavorable0.192%85%94%0.349%38%63%Normal0.422%23%21%Unfavorable0.2-18%-17%-19%How much is the expected rate of returnfor Stock C? Use a whole number inpercent form, no space, no commas, nosigns.

Solution:- We know, expected rate of return in case of data (ie. Which involves probability) is the…

Consider the following information given to > answer the series of questions below to determine the preferred investment using the measurement for a stand alone risk. Probability of this Company's Products Demand occurring Demand for the Rate of Return on stock if this Demand occurs Stock A Stock B Stock C Highly Favorable Favorable 0.1 92% 85% 94% 0.3 49% 38% 63% Normal 0.4 22% 23% 21% Unfavorable 0.2 -18% -17% -19% How much is the expected rate of return for Stock C? Use a whole number in percent form, no space, no commas, no signs. *

Consider the following information given to > answer the series of questions below to determine the preferred investment using the measurement for a stand alone risk. Probability of this Company's Products Demand occurring Demand for the Rate of Return on stock if this Demand occurs Stock A Stock B Stock C Highly Favorable Favorable 0.1 92% 85% 94% 0.3 49% 38% 63% Normal 0.4 22% 23% 21% Unfavorable 0.2 -18% -17% -19% How much is the expected rate of return for Stock C? Use a whole number in percent form, no space, no commas, no signs. *

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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Give typing answer with explanation and conclusion
3. The following information is given with respect to stock A: Scenario Probability Market return 1 0.1 -0.18 2 0.3 0.07 3 0.4 0.16 4 0.2 0.21 Knowing that the Rfis 0.07 compute alpha and the information ratio. Portfolio P return -0.32 0.00 0.22 0.40
dont answer by pen paper
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM Stock Rit Rmt ai Beta C 12 10 0 0.8 E 10 8 0 1.1 Rit = return for stock i during period t Rmt = return for the aggregate market during period t What is the abnormal rate of return for Stock C during period t using only the aggregate market return (ignore differential systematic risk)?
Need answer to both parts
Consider the following information: State of Probability of Economy State of Economy .17 .43 .33 .07 Boon Good Poor Bast Stock A a. Expected return b. Variance c. Standard deviation 11.70% 0.00120 3.40 .352 Answer is complete but not entirely correct. 122 012 -.112 % Rate of Return if State Occurs Stock B a. Your portfolio is Invested 32 percent each in A and C and 36 percent in B. What is the expected return of the portfolio? Note: Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. What is the variance of this portfolio? Note: Do not round Intermediate calculations and round your answer to 5 decimal places, e.g., .16161. c. What is the standard deviation of this portfolio? Note: Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. .452 .102 .022 -.252 Stock C .332 .172 -.052 -.092
From the following information, calculate covariance between stocks A and B and expected return and risk of a portfolio in which A and B are equally weighted.Which stock would be recommend if investment in individual stock is to be made? Justify answer using numerical calculations. Stock A Stock B Expected return 24% 35% Standard deviation 12% 18% Coefficient of correlation 0.65 0.65
A stock’s returns have the following distribution:Demand for theCompany’s ProductsProbability of thisDemand OccurringRate of Return if thisDemand OccursWeak 0.1 (30%)Below average 0.1 (14)Average 0.3 11Above average 0.3 20Strong 0.2 451.0Assume the risk-free rate is 2%. Calculate the stock’s expected return, standard deviation,coefficient of variation, and Sharpe ratio.
(Expected rate of return and risk) Syntex, Inc. is considering an investment in one of two common stocks Given the information that filloors, which investment is better based on the risk (as measured by the standard deviation) and retum? Common Stock A Probability 0,20 0.60 0:20 Return 10% 17% 20% Common Stock B Probability 0.25 0.25 0.25 0.25 (Click on the icon in order to copy its contents into a spreadsheet) Return -6% 5% 16% 23% a. Given the information in the table, the expected rate of retum for stock Ais (Round to two decimal places)
2. Consider the following expected returns, volatilities, and correlations: Expected Standard Stock Return Deviation Correlation with Vital Correlation with Mital Correlation with Pital Vital 14% 6% 1.0 -1.0 0.0 Mital 44% 24% -1.0 1.0 0.7 Pital 23% 14% 0.0 0.7 1.0 a. Imagine a portfolio comprising solely of Vital and Mital. What portion of should be allocated to Vital stock to ensure a risk-free investment? your investment b. What is the portfolio's volatility when holding a $10,000 long position in Pital and a $2000 short position in Mital? wwwww c. In a market, there are two securities, Artis and Brotis. Currently, the price of Artis stands at £50. Looking ahead, the price of Artis next year will be £40 during a recession, £55 in normal economic times, and £60 in an expanding economy. The probabilities associated with recession, normal times, and expansion are 0.1, 0.8, and 0.1, respectively. Artis does not pay dividends and has a correlation of 0.8 with the market. On the other…
The standard deviation of a stock’s return is a measure of its? Multiple Choice systematic risk correlation expected future return total risk

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