CORPORATE FINANCE - CONNECT ACCESS
CORPORATE FINANCE - CONNECT ACCESS
12th Edition
ISBN: 9781264054893
Author: Ross
Publisher: MCG
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Chapter 11, Problem 6QAP
Summary Introduction

Adequate information:

Probability in Depression PD = 0.15

Probability in Recession PR = 0.30

Probability in Normal PN = 0.45

Probability in Boom PB = 0.10

Return for Stock in Depression RD = -0.148

Return for Stock in Recession RR = 0.031

Return for Stock in Normal RN = 0.162

Return for Stock in Boom RB = 0.348

To compute: Expected return and standard deviation of the stock.

Introduction: Expected return refers to the return that is anticipated on the stock in the near future. The standard deviation of stock refers to the dispersion of the actual price from the average price.

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Chapter 11 Solutions

CORPORATE FINANCE - CONNECT ACCESS

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