Expected return. Hull Consultants, a famous think tank in the Midwest, has provided probability estimates for the four potential economic states for the coming year. The probability of a boom economy is 10%, the probability of a stable growth economy is 19%, the probability of a stagnant economy is 45%, and the probability of a recession is 26%. Estimate the expected returns on the following individual investments for the coming year, H Hint: Make sure to round all intermediate calculations to at least seven (7) decimal places. The input instructions, phrases in parenthesis after each answer box, only apply for the answers you will type. What is the expected return of the stock investment? % (Round to two decimal places.) - X Data Table (Click on the following icon o in order to copy its contents into a spreadsheet.) Forecasted Returns for Each Economy Stable Investment Boom Growth Stagnant Recession Stock 28% 13% 5% - 14% 4% Check Answer Corporate bond 9% 7% 6% 8% 6% 5% 3% ont hond
Expected return. Hull Consultants, a famous think tank in the Midwest, has provided probability estimates for the four potential economic states for the coming year. The probability of a boom economy is 10%, the probability of a stable growth economy is 19%, the probability of a stagnant economy is 45%, and the probability of a recession is 26%. Estimate the expected returns on the following individual investments for the coming year, H Hint: Make sure to round all intermediate calculations to at least seven (7) decimal places. The input instructions, phrases in parenthesis after each answer box, only apply for the answers you will type. What is the expected return of the stock investment? % (Round to two decimal places.) - X Data Table (Click on the following icon o in order to copy its contents into a spreadsheet.) Forecasted Returns for Each Economy Stable Investment Boom Growth Stagnant Recession Stock 28% 13% 5% - 14% 4% Check Answer Corporate bond 9% 7% 6% 8% 6% 5% 3% ont hond
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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Expected return. Hull Consultants, a famous think tank in the Midwest, has provided probability estimates for the four potential economic states for the coming year.
The probability of a boom economy is 10%, the probability of a stable growth economy is 19%, the probability of a stagnant economy is 45%, ard the probability of a
recession is 26%. Estimate the expected returns on the following individual investments for the coming year,
Hint: Make sure to round all intermediate calculations to at least seven (7) decimal places. The input instructions, phrases in parenthesis after each answer box, only
apply for the answers you will type.
Incorrec
What is the expected return of the stock investment?
% (Round to two decimal places.)
Data Table
(Click on the following icon in order to copy its contents into a spreadsheet.)
Forecasted Returns for Each Economy
Stable
Investment
Boom
Growth
Stagnant
Recession
Stock
28%
13%
5%
- 14%
4%
Check Answer
Corporate bond
Government bond
9%
7%
6%
8%
6%
5%
3%
9 M
DII
&
%23
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3.
4
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m
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