The stock of Business Adventures sells for $50 per share. Its likely dividend payout and end-of-year price depend on the state of the economy by the end of the year as follows: The expected return of the stock is State of the economy Boom Normal Recession Probability Dividend 0.2 0.5 0.3 % Stock price 2 1 0 60 53 45 Continued with previous question. The estimated standard deviation of the stock is %

Essentials Of Investments
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ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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The stock of Business Adventures sells for $50 per share. Its likely dividend payout and end-of-year price depend on the state of
the economy by the end of the year as follows:
The expected return of the stock is
State of the economy
Boom
Normal
Recession
Probability Dividend
0.2
0.5
0.3
%
2
1
0
Stock price
60
53
45
Continued with previous question. The estimated standard deviation of the stock is
%
Transcribed Image Text:The stock of Business Adventures sells for $50 per share. Its likely dividend payout and end-of-year price depend on the state of the economy by the end of the year as follows: The expected return of the stock is State of the economy Boom Normal Recession Probability Dividend 0.2 0.5 0.3 % 2 1 0 Stock price 60 53 45 Continued with previous question. The estimated standard deviation of the stock is %
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