P8-1 Expected Return Given these three economic states, their likelihoods, ane potential returns, compute the expected return, standard deviation and coefficien variation: Economic Probability Return State Fast Growth Slow Growth 0.10 50% 0.80 15% Recession 0.10 -30%

P8-1 Expected Return Given these three economic states, their likelihoods, ane potential returns, compute the expected return, standard deviation and coefficien variation: Economic Probability Return State Fast Growth Slow Growth 0.10 50% 0.80 15% Recession 0.10 -30%

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

CНАРTER 8
P8-1 Expected Return Given these three economic states, their likelihoods, and the
potential returns, compute the expected return, standard deviation and coefficient of
variation:
Economic
Probability Return
State
Fast Growth
0.10
50%
Slow Growth
0.80
15%
Recession
0.10
-30%

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Q25 Following are three economic states, their likelihoods, and the potential returns: Economic State Probability Return Fast growth 0.3 40 % Slow growth 0.4 10 Recession 0.3 –25 Determine the standard deviation of the expected return. (Do not round intermediate calculations and round your answer to 2 decimal places.) STANDARD DEVIATION. %
Based on the provided data what is the standard deviation of the VOO ETF total returns for the 3-year period between 2021 to 2023? Year 2023 2022 2021 2020 2019 T-bill total return 4.29% -3.82% -0.60% 3.16% 3.59% 20% average return ≤ 25% 25% < average return ≤ 30% 30% < average return ≤ 35% 35% average return S&P 500 total VOO ETF total return return 26.29% 26.33% -18.11% -18.15% 28.71% 28.60% 18.40% 18.40% 31.49% 31.47%
Vijay
5 Consider the following information: Probability of State of State of Economy Boom Good Poor Bust Economy 15 .45 .35 .05 a. Rate of Return if State Occurs a. Expected return b-1. Variance b-2. Standard deviation Stock A Stock B Stock C .36 46 .26 .21 .17 10 -.03 -.17 Your portfolio is invested 22 percent each in A and C, and 56 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b-1. What is the variance of this portfolio? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., .16161.) b-2. What is the standard deviation? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) % -.06 -.21 % -.04 -.07
% 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%
can you help me with question b please
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
39. Consider the following information. Assuming this represents the Population. Investment X 4% -10% 8% 8 Year 1 2 3 14% Investment Y -6% 8% 12% -2% Risk Free Rate: 2% The Covariance of Investment X and Investment Y is (Hint: Covariance = 1/nΣ(xi — Xavg)(yi - Yavg) A. -32.60 B. -21.00 C. +144.82 D. -103.50 E. +114.34

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