Scenario Probability Expected Return18%38%30%14%100%30%20%15%-8%12An analyst creates a probabilistic scenario analysis for projecting stock market returns. The analyst's work is shown in the above table.The Interpretation of the table can be described as follows: The analyst assigns a probability of 18% to the first scenario, which projectsa stock market return of 30%. Subsequent rows can be interpreted similarly.The expected return of the analyst's projections is closest to:100%16%30%-8%

Expected value explains the average observation of the data set. It is calculated by multiplying the…

Answered: Scenario Probability Expected Return…

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

See similar textbooks

Similar questions

The Gorman Manufacturing Company must decide whether to manufacture a component part at its Milan, Michigan, plant or purchase the component part from a supplier. The resulting profit is dependent upon the demand for the product. The following payoff table shows the projected profit (in thousands of dollars): State of Nature Low Demand Medium Demand High Demand Decision Alternative s1 s2 s3 Manufacture, d1 -20 40 100 Purchase, d2 10 45 70 The state-of-nature probabilities are P(s1) = 0.35, P(s2) = 0.35, and P(s3) = 0.30. What is Gorman's optimal decision strategy?Decision strategy:If F then .If U then . What is the expected value of the market research information?Expected value: $ What is the efficiency of the information? If required, round your answer to one decimal place.Efficiency:
Organizers of an outdoor summer concert in Toronto are concerned about the weather conditions on the day of the concert. They will make a profit of $33,000 on a clear day and $15,000 on a cloudy day. They will make a loss of $7,000 if it rains. The weather channel has predicted a 52% chance of rain on the day of the concert. Calculate the expected profit from the concert if the likelihood is 11% that it will be sunny and 37% that it will be cloudy.
Investment advisors recommend risk reduction through international diversification. International investing allows you to take advantage of the potential for growth in foreign economies, particularly in emerging markets. Janice Wong is considering investment in either Europe or Asia. She has studied these markets and believes that both markets will be influenced by the U.S. economy, which has a 20% chance for being good, a 50% chance for being fair, and a 30% chance for being poor. Probability distributions of the returns for these markets are given in the accompanying table. State of the U.S. Economy Returns in Europe Returns in Asia Good 10% 18% Fair 6% 10% Poor −6% −12%
Business projection: An investor is considering an investment in a start-up company. She estimates that she has probability 0.39 of a $22,400 loss, probability 0.28 of a $10,000 profit, probability 0.13 of a $34,000 profit, and probability 0.2 of breaking even (a profit of $0 ). What is the expected value of the profit? Would you advise the investor to make the investment? The expected value of the profit is $
On the basis of his sale records, a salesman knows that his weekly commissions have the probabilities shown below. Commission 0 $1,000 $2,000 $3,000 $4,000 Probability 0.17 0.2 0.43 0.1 0.1 Find the salesman's expected commission.
consultant has been hired to redesign a company's production facility. The consultant estimates the probabilities of her potential profit as shown in the table below. What is her profit expectation?$ Profit/Loss Probability $40,000 0.05 $30,000 0.30 $20,000 0.38 $10,000 0.20 $5,000 0.07
Pricilla Phranklin opened her clothing store, Pricilla Phashions, in Downtown Dover a little over three years ago. Pants, skirts, blouses, and shirts have fairly consistent sales, while things like shorts, sweater and outerwear are highly seasonal. On the other hand, dresses are a little harder to predict. Pricilla is hiring you to arrive at the best forecasting method for dresses. The following table contains three years of dress sales data Year 3 Year 1 Year 2 Mont Dema Dema h nd nd nd Jan 186 217 212 Feb 222 220 245 Mar 220 239 252 Apr 356 362 376 720 May 727 757 [1] Jun 367 376 404 Jul 340 341 354 Aug 293 290 324 Sep 305 296 338 Oct 600 600 618 325 318 679 708 4613 4694 Nov Dec Total 1. 2. 3. Dema 4. 5. 356 713 Using the dress data above, calculate the following 4949 Forecast year 3 using a simple 3 period moving average Forecast year 3 Calculate a forecast using the exponential smoothing method. Assume a = 0.20 (a) Using the information you have for years 1 & 2, calculate a…
You have done risk analysis and determine the following risks and their probabilities could affect your project. Based on these risks, what should you contingency reserve be? Risk 1: 50% chance of a weather delay costing $5,000Risk 2: 20% chance of a worker strike costing $10,000Risk 3: 10% chance of catastrophic failure costing $50,000
Sources of Energy Use A breakdown of the sources of energy used in a country is shown below. Hydropower 3% Oil 42% Natural Gas 20% Coal 27% Nuclear 5% Other 3% Send data to Excel Choose one energy source at random. Find the probabilities of the following. Enter your answers as decimals rounded to 2 decimal places. Part 1 of 3 (a) Not hydropower P(Not hydropower) = | Part 2 of 3 (b) Oil or hydropower P(oil or hydropower) = Part 3 of 3 (c) Coal P(Coal) =

Recommended textbooks for you

MATLAB: An Introduction with Applications

Statistics

ISBN:

9781119256830

Author:

Amos Gilat

Publisher:

John Wiley & Sons Inc

Probability and Statistics for Engineering and th…

Statistics

ISBN:

9781305251809

Author:

Jay L. Devore

Publisher:

Cengage Learning

Statistics for The Behavioral Sciences (MindTap C…

Statistics

ISBN:

9781305504912

Author:

Frederick J Gravetter, Larry B. Wallnau

Publisher:

Cengage Learning

MATLAB: An Introduction with Applications

Statistics

ISBN:

9781119256830

Author:

Amos Gilat

Publisher:

John Wiley & Sons Inc

Probability and Statistics for Engineering and th…

Statistics

ISBN:

9781305251809

Author:

Jay L. Devore

Publisher:

Cengage Learning

Statistics for The Behavioral Sciences (MindTap C…

Statistics

ISBN:

9781305504912

Author:

Frederick J Gravetter, Larry B. Wallnau

Publisher:

Cengage Learning

Elementary Statistics: Picturing the World (7th E…

Statistics

ISBN:

9780134683416

Author:

Ron Larson, Betsy Farber

Publisher:

PEARSON

The Basic Practice of Statistics

Statistics

ISBN:

9781319042578

Author:

David S. Moore, William I. Notz, Michael A. Fligner

Publisher:

W. H. Freeman

Introduction to the Practice of Statistics

Statistics

ISBN:

9781319013387

Author:

David S. Moore, George P. McCabe, Bruce A. Craig

Publisher:

W. H. Freeman

SEE MORE TEXTBOOKS