Recession normal boom standard deviation. 108 . 0021? Question: Based on the following information: Rate of Return If State Occurs State of Probability of Economy State of Economy Stock A Stock. 2% Finance questions and answers. State of Economy|Probability of State of Economy|Security Return If State Occurs Recession|. 3 Standard deviation (4 marks) A stock is expected to return 15% in a normal economy, 20% in a boom, and lose 10% in a recession. 31 Normal . What is the standard deviation of the stock's returns? The economy may enter boom, recession or normal states in the next year. 20|24 12. 90 percent. 9% 20. 16 -. 34% 3. 8 percent in a recession, a return of 12. 2 percent in a recession, a return of 11. Based on the following information, calculate the expected return and standard deviation for the two stocks: Probability of State Economy Rate of Return Stock A Stock B Recession 15% 4% -17% Normal 55% 9% 12% Boom 30% 17% 27% and more. 21 What is the standard deviation of Orange? A stock will have a loss of 13. 14 21 Calculate the standard deviation. 27% e) 22. What is the standard deviation of the stock's returns? State of Economy Probability of State of Economy Rate of Return if State Occurs Recession . 87% d) 18. 25 -0. 08 . Probability of each scenario, stock and bond annual returns in that scenario are provided below. 32 . 4 percent in a recession, a return of 11. 12 Stock B - . 16 Boom . 80%. 00) = 9. There is 31 percent probability of a recession, 34 percent probability of normal economy, and 35 percent probability of boom. 15 Stock B -. 01598)^. 040 – . 67%. 026 Expected rate of return …. Normal 0. Consider the following information: State of Economy Probability of State of Economy Rate of Return if State Occurs Stock A Stock B Recession . Enter your answer as a percent rounded to 2 Question: Expected Return and Standard Deviation. 21% 9. 85% 19. 60 +15 +8 Boom . 8 percent in a normal economy, and a return of 26. 5% 6% 8% B. What is the standard deviation of the returns on this stock? Question: Calculating Returns and Standard Deviations. 40 11% Recession . 35 0. Question: Calculate mean and standard deviation for the following asset. 40% b) 14. 19 . 15. 062 . 25 0. What is the standard deviation of the stock's returns? Consider the following information: Probability of State Rate of Return if State Occurs Economy of Economy Stock A Stock B Recession . The remainder of the time the economy will be at normal levels. Mean = probability*return = . How much is the annual standard deviation of the portfolio returns? Recession: % Normal economy: % Boom: % b. 20. 148 Recession . 12. Calculate the expected rate of return and standard deviation for each investment. 1 percent in a recession, a return of 11. g. 1 percent in a boom. ) Probability Security of Return State of if Our expert help has broken down your problem into an easy-to-learn solution you can count on. 0017 0. Calculating Returns and Standard Deviations Based on the following information, calculate the expected return and standard deviation: State of Economy Probability of State of Economy Rate of Return if State Occurs Depression . 29 . 27. 39% d. 05% . 27 . 30 (3) Stock A Rate of Return If State Occurs -. 036 Boom 0. 1 percent in a normal economy, and a return of 25. Note: Do not round intermediate calculations. Calculate the expected return for Stocks A and B. First we will calculate the mean return as per below: The formula for mean is: Mean = p1 * r1 + p2 * r2 + p3 * r3 where, p1 What is the expected return on the portfolio?, 3. 133 . 34% . 09 0. Based on the following information, what is the The probabilities of a boom, normal economy, and a recession are 6 percent, 92 percent, and 2 percent, respectively. Problem 11-8 Calculating Returns and Standard Deviations (LO1, CFA2) Consider the following information: Rate of Return if State Occurs ok Probability of State of State of nt Econony Stock A Stock B 0. 233 A stock will have a loss of 13. 60% . 5% 10. ) Expected Return: % Standard Deviation: % Probability State of of State of Rate of Economy Economy Return Boom. If a Bad Question: Given the following information, what is the standard deviation for this stock? (Hint: you'll need to find the expected return first) - Probabilities: Recession: 0. 1 State of economy Probability of State of economy Rate of return Expected Return Recession 0. 2% 24. There is 21 percent probability of a recession, 48 percent probability of normal economy, and 31 percent probability of boom. 5 percent in a boom. 27 Question: 4. Westover stock is expected to return 36 percent in a boom, 14 percent in a normal economy, and lose 75 percent in a recession. 144 or14% EXAMPLE 2: Consider the following information: State Probability ABC, Inc. (Enter your answer as a percent rounded to 1 decimal place. 5% 19. 16 Stock B a. 125 . 6 percent in a boom. 6 percent in a recession, a return of 113 percent in a normal economy, and a return of 26 percent in a boom. A. Problem 11-2 Standard Deviations (LO1, CFA2) Use the following information on states of the economy and stock returns to calculate the standard deviation of returns. 23 Stock A . 17) Normal 0. 46% Recession 0. There is 30 percent probability of a recession, 39 percent probability of normal economy, and 31 percent probability of boom. 6 percent in a recession, a return of 13. 3 Rate of Return Stocks Bonds -4% 12% 13 7 22 3 Boom Assume a portfolio Your solution’s ready to go! Our expert help has broken down your problem into an easy-to-learn solution you can count on. 44 a. Enter your answer as a percent rounded to 2 decimal places. 45*15% + . There is 27 percent probability of a recession, 30 percent probability of normal economy, and 43 percent probability of boom. 13 -102 . 01 -0. 62 a. What is the expected return? - E(R) = . Omit the "%" sign in your response. 38 There are three states of the economy: Boom Normal and Recession where the probability of each state is 30% 30% and 40% respectively. 12 0. 09 Boom 0. 30 . State of Economy Probability of State of Economy Rate of Return if State Occurs Stock A Stock B Recession 0. There is 29 percent probability of a recession, 40 percent probability of normal economy, and 31 percent probability of boom. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e. State of of State of Rate of. 12-60 % 24. A stock is expected to return 15% in a normal economy, 20% in a boom, and lose 10% in a recession. 04 (0. 59 . 22 . 24 . 0,15 0,08 0,04 -0,03 Based on the information provided above, calculate the following: 4. 56%. 42 percent . 3(-. 20 8. What is the standard deviation of the stock's returns? Question: State of Economy Probability of State of Economy Security Return If State Occurs Recession . 79% D. 23 . ) Output area The return on shares of the Orange Company are predicted under the following states of nature. 16. 25*-25% + . 43 . 91% B. 20 0. Question: A stock will have a loss of 13. Problem 11-5 Calculating Returns and Standard Deviations You have been given the following information: Rate of Return If State Occurs State of Probability of Economy State of Economy Recession . 55. Based on the following information, calculate the expected return and standard deviation for the two stocks. See Answer. Use the following information on states of the economy and stock returns to calculate the standard deviation of returns. 2 Consider the following information: State Boom Normal Slowdown Recession Probability 0,30 0,45 0,10 0,15 A. 20 +25 Your solution’s ready to go! Our expert help has broken down your problem into an easy-to-learn solution you can count on. 18 31. What are the expected rate of return and standard deviation of the portfolio?(Do not round intermediate calculations. QUESTION 12 The following returns are provided from the past: Condition Return Probability Recession 19 23 Normal 5% . Assuming that all three states are equally likely. 57 percent. 2 Returns: Recession:-10% Normal:12% Boom:16% 9. Boom: 0. The states of nature are all equally likely, and because there are a total of three states, each state has a 33. 17 a. 35 23 Standard deviation % Our expert help has broken down your problem into an easy-to-learn solution you can count on. 109 Based on the following information, what is the standard deviation of returns? State of Economy A stock will have a loss of 12. What is the standard deviation of the stock's returns? 11. 35 −7. View the full answer. 38% 3. 18% Question: Consider the following information: Rate of Return if State Occurs Probability of State of Economy Economy Recession Normal Boom Stock A 050 130 320 Stock B 23 -43 63 33 14 56 a. b) 28. (Do not round intermediate calculations and round your final answers to 2 decimal places. 09 -0. Calculate the volatility of stock A if it is expected to have 10% return in boom 2% return in normal and -6% return in recession. 60 in stocks and . 3 Returns: Recession: −9% Normal: 7. Question: Problem 11-18 Portfolio Analysis (LO3) Consider the following scenario analysis: Scenario Recession Normal economy Probability 0. 5 18 11 Boom 0. 11 −. Is it 0. 30 0. 28 17 Calculate the expected Finance questions and answers. 104 Recession . 55 percent The probability of a recession is 30 percent while the probability of a boom is 5 percent. 60 30 Rate of Return if State Occurs Stock A Stock B 0. 56 . 12 2. If the risk free rate of return is 1% and you Question: You have been given this probability distribution for the holding-period return for GM stock: State of the Economy Probability HPR Boom . 12 Boom 0. 24 − . 15 Boom 0. 2(. Input area: Example Input area State Probability Stock A Stock B Recession 0. 16)) Rate of Return Scenario Probability Stocks Bonds Recession . 04 Normal Normal 0. Here’s the best way to solve it. 30 Output area: Output area: Squared Deviation Product Return Stock A Here’s the best way to solve it. 1 …. 22: 24 % Normal: 0. 25 Return -1. 28 percent. 7 percent in a recession, a return of 11. Recession -0. Calculate the expected return for the two stocks. 2 % Boom b. In finance and investment, standard deviation is commonly used Problem 11-5 Calculating Returns and Standard Deviations Based on the following information: Rate of Return If State Occurs State of Economy Recession Normal Boom Probability of State of Economy Stock A 21 . 66% E. 65% Stock B expected return 12. Question: Problem 13-7 Calculating Returns and Standard Deviations [LO1] Consider the following information: Rate of Return If State Occurs State of Stock A Stock B Economy Recession Normal Boom Probability of State of Economy . 05 0. 45 . 19 Recession Normal Boom . 1 percent in a normal economy, and a return of 26. Calculate the return and standard deviation for the following stock, in an economy with five possible states. 02 . What is the expected return on the security? (4 marks) ii. 200 . Economy Economy Return. , 32. 07 . , A stock will have a loss of 12. 94 Scenario Recession Normal economy Boom Probability . 38 percent . State of Economy Probability of State of Economy Security Return if State Occurs Recession 0. a. 15% Stock A standard deviation 4. 19% c. Is it reasonable to assume that Treasury bonds will provide higher returns in recessions than in booms? b. (Do not round intermediate calculations and enter your answers as a Question: Q3) Based on the following information, calculate the expected return and standard deviation for Stock A and Stock B: State of Economy Recession Normal Boom Probability of State of Economy . If a Boom (Probability=25%) economy occurs, then the expected return is 50%. 175 Normal 0. 04 -0. 40 in bonds. 3 Normal: 0. 120 . Question: Based on the following information, what is the standard deviation of returns? State of Economy Probability of State of Economy Rate of Return if State Occurs. Question: Based on the following information, what is the standard deviation of returns? State of Economy Recession Normal Boom Probability of State of Economy . 9 percent in a normal economy, and a return of 26. Let's also assume that you are creating a portfolio with 65% stocks and 35% bonds. 4 percent in a normal economy, and a return of 26. 17) Normal 0. 3 23 4 Assume a portfolio with weights of 0. 15 0. 13 . 5 = 12. What is the standard deviation of expected return for the next year? 10. 53% Assume that an economy can have four states: Severe recession, Mild recession, Normal growth, Boom. What is the standard deviation of a portfolio invested 20 percent in Stock A, 30 percent in Stock B, and 50 percent in Stock C? Question: Based on the following information, calculate the expected return and standard deviation for Stock A and Stock B. To begin solving this problem, you need to calculate the mean return using the formula for mean and the given values for the probability of economic states and their associated returns. 25 Normal 0. 15 -. If a Good (Probability=25%) economy occurs, then the expected return is 15%. 86% none of these QUESTION 13 The market risk premium is 5. 55 . There are two assets and three states of the economy. 28 Calculate the expected return for each stock. Standard Deviation is the square root of . 5% Boom: 16% 9. 17 Calculate the expected return and standard deviation. The economy may enter boom, recession or normal states in the next year. Calculate the expected return and standard deviation. 25 Rate of Return if State Occurs Expected return for A Expected return for B Stock A 0. What is the standard deviation of the stock's returns? a)15. Given the following probable states of the economy and the expected return on a security in each state: State of economy Recession Normal Boom Probability 0. 0% -12. 20 −5 % +14 % Normal economy . 32 − . 5 percent in a normal economy, and a return of 27. A stock will have a loss of 13. 1. 50 40 . 0010 0. 50 . Scenario Recession Normal economy Boom Probability 0. 42 Expansion 9% Boom 13% . Portfolio Risk and Return / Using the information in the precious problem, suppose you have $20,000 total. 37 . 10. Your solution’s ready to go! Our expert help has broken down your problem into an easy-to-learn solution you can count on. What is the standard deviation of the expected returns? - 11. Input areo: Stock A State Probability Recession 0. 13. ) Rate of Return 2. 15 Normal +0. Recession . There are two assets and three states of the economy: (1) State of Economy Recession Normal Boom (2) Probability of State of Economy . What is the standard deviation of the returns on this stock? 19. 15 − . ) There are 2 steps to solve this one. 5. 09. 30 (5 marks) Based on the following information, calculate the expected return and standard deviation for the 2 stocks. There are 2 steps to solve this one. 27 (Use cells A6 to D9 from the given information to complete this question. 310 155 *. 060. What is the standard deviation of the returns on this stock? a) 11. S13-07 Calculating Returns and Standard Deviations (LO1] Consider the following information: Rate of Return if State Occurs 13 State of Economy Recession Normal Boom Probability of State of Economy . 0960)^2 = . 17 percent. 10 . 52 . 5(15. 35 State of Economy Recession Normal Boom Stock A. 26 − . 25 . 09 Normal 0. 2% 15. 031 Normal . 348. Normal . 21 . 49% 15 315 Your solution’s ready to go! Our expert help has broken down your problem into an easy-to-learn solution you can count on. 2 % 1. 49 . 08. Based on the following information, calculate the expected return and standard deviation for Stock A and Stock B. 128 Boom . 61 Boom . 10 -0. 09 . This problem will give you some practice calculating measures of prospective portfolio performance. 64% Explanation: . 15 Returns: Recession: -11% Normal: 9% Boom: 13% --- a. (e. 05. 2(24. 3 Normal:0. 25(0) + . You have been given the following information: State of Economy Depression Recession Normal Boom Probability of Rate of Return State of Economy if State Occurs . 50% Stock B standard deviation 13. (Do not round intermediate calculations and enter your answers as Expected Return and Standard Deviation / This problem will give you some practice calculating measures of prospective portfolio performance. 045 -42 . 79% c) 15. 65 0. 11 Boom . 26 . 5%. 18 Normal . 13 Normal . 06 Boom +0. 4 0. 83% 12. 1 Expected return (5 marks) 4. ) Expected return % Standard deviation % Calculate the standard deviation. Boom 0. 45 15. 05 -. 4 Boom: 0. 2 Rate of Return Stocks Bonds Recession -5% 17% Normal economy 0. 12 О. 9 percent in a normal economy, and a return of 27. If a Normal (Probability=20%) economy occurs, then the expected return is 15%. If a Normal (Probability=20%) economy occurs, then the expected return is 8%. 15 . 128 Recession 0. If you put $15,000 in Stock A and the A stock will have a loss of 14. 15(0) + . You have been given this probability Problem 11-13 Scenario Analysis (LO2) Consider the following scenario analysis: Rate of Return Scenario Probability Stocks Bonds Recession 0. 64% Consider the following information: State of Economy Recession Normal Boom Probability of State of Economy 0. 21 0. 20 −7 % 20 % Normal Your solution’s ready to go! Our expert help has broken down your problem into an easy-to-learn solution you can count on. State of Economy Probability of State of Economy Rate of Return If State Occurs Stock A Stock B Recession Normal Boom . 05) (0. Stock B -. What is the rate of return on the portfolio in each scenario? (Do not round intermediate A stock will have a loss of 12. 20 (0. 81% . Problem 11-7 Calculating Returns and Standard Deviations [LO 1) Consider the following information: Economy Recession Normal Boom Probability of Rate of Return if State Occurs State of Economy Stock A Stock B . 3. 55 Boom: 0. 28 0. 35 –9 % Normal . There is 23 percent probability of a recession, 26 percent probability of normal economy, and 51 percent probability of boom. 04 0. 04 Boom +0. com. Enter your answer os o percent rounded to 2 decimal places. 04 . 40 -0. 110Normal . 094 Normal . 30 -0. 00% Expected Return = 9. 00) + . What is the standard deviation of the stock's returns? Finance questions and answers. Answer to Solved What is the standard deviation of the returns on this | Chegg. 50|15 Boom|. 45 0. 18 . The probability of a recession is 25 percent while the probability of a boom is 30 percent. 14. percent probability of a recession, 25 percent probablity of normal economy, and 53 percent probability of boom. 60 0. 3 percent in a recession, a return of 12 percent in a normal economy, and a return of 26. What is the standard deviation of expected return for the next year? 20. 27 (Use cells A6 to D9 from. 2. 235Multiple Choice13. 13% C. 52 percent. 14 Normal +0. Step 1. What is the standard deviation of the stock's returns? rev: 05_04_2018_QC_CS-126555 28. 25% E. If a Boom (Probability=25%) economy occurs, then the expected return is 30%. There is 23 percent probability of a recession, 46 percent probability of normal economy, and 31 percent probability of boom. 26 0. 7 percent in a recession, a return of 13. What is the standard deviation of the stock's returns? Stock C is expected to return 5 percent in a boom, 7 percent in a normal economy, and 8 percent in a recession. Question: Given the following information, what is the standard deviation for this stock? (Hint: you'll need to find the expected return first) Probabilities: Recession: 0. 92% STOCK A State of Economy Probability (P) RETURN (Y) (P * Y ) P * ( …. 33 a. 55 0. 12 . Economic State Return Probability Recession -25% 25% Normal 15% 45% Boom. Created by Chegg. 21 -. There is 31 percent probability of a recession, 38 percent probability of normal economy, and 31 percent probability of boom. 30 14 Boom . 15. This problem has been solved! You'll get a detailed solution from a subject matter expert that helps you learn core concepts. 10 Our expert help has broken down your problem into an easy-to-learn solution you can count on. Question: Given the following information, what is the standard deviation for this stock? (Hint: you'll need to find the expected return first) Probabilities: Recession:0. 48 . 2 percent in a boom. Economic State Return Probability Recession -21% 30% Normal 11% 40% Boom 32% 30%. 24 Calculate the expected return for each stock. 55% 1185 14. Input area: State Probability Stock A Stock B Recession 0. Question: Problem 13-7 Calculating Returns and Standard Deviations [LO1] Consider the following information: Rate of Return If State Occurs State of Probability of State of Economy Economy Stock A Stock B . 07. 125Boom . 8 0. 17 0. Question: Consider the following scenario analysis: Scenario Probability 0. 8 percent in a boom. Question: Given the following information, what is the standard deviation of the returns on this stock? Boom 35% 10% Normal 40% 25% Recession 25% -36% Standard. 87% F. 00 Boom 0. 100 Normal . What is the standard deviation of the returns on this stock? (round to six decimal places for intermediate calculation) . 51 . ) Standard deviation Question: You have been given the following information: State of Economy Probability of State of Economy Rate of Return if State Occurs Depression . 9. 5(. (Do not round intermediate calculations. 24 −. 88% 9 Finance questions and answers. 61 . 30 Stock A . There is 24 percent probability of a recession, 45 percent probability of normal economy, and 31 percent probability of boom. 13 . 3(-9. Calculate mean and standard deviation for the following asset. 162 Boom . 67 0. 3 percent in a normal economy, and a return of 28 percent in a boom. 100% (25 ratings) State of Economy Probability of state of Economy Rate of return if state occurs Boom 0. Question: Based on the following information, what is the standard deviation of returns? State of Economy Probability of State of Economy Rate of Return if State OccursRecession . Based on the following information Question: A stock will have a loss of 13. What is the standard deviation of the stock's returns? 13. Return Boom . 11 . 9%. 14 0. 2 Variance (5 marks) 4. c Here’s the best way to solve it. There is 28 percent probability of a recession, 41 percent probability of normal economy, and 31 percent probability of boom. Our expert help has broken down your problem into an easy-to-learn solution you can count on. 1(-0) = 8% State of economy Probability of economy Stock A Return Stock B Return Recession. 84%. 12 Boom 0. 17) 0. c. Based on the following information, calculated the expected return and standard deviation for the stock (7 points): State Probability Return Recession 0. 3 0. 66: 12 % Recession: 0. 55 Boom 0. 45 Rate of Return if State Occurs -. A stock will have a loss of 14. What is the standard deviation of the stock's returns? In a boom economy, the stock is expected to return 46 percent in comparison to 16 percent in a normal economy and a negative 28 percent in a recessionary period. Slowdown . Calculating Returns and Standard Deviations Based on the following information, calculate the expected return and standard deviation for the two stocks: State of Economy Probability of State of Economy Rate of Return if State Occurs. 2 percent in a recession, a return of 12. 20 . Recession 0. 10% The return on shares of the Orange Company are predicted under the following states of nature. 0960)^2 + . 00% … View the full answer Previous question Next question Question: 6. 2% 10. 115 Boom Question: Use the following information on states of the economy and stock returns to calculate the standard deviation of returns. 20 Scenario Recession Normal economy Boom Rate of Return Stocks -5% Expected rate of return Standard deviation +15 +25 Consider a portfolio with weights of . 31 a. i. 01598 σ = (. 8. What is the standard deviation of the stock's returns? Question: Based on the following information, what is the standard deviation of returns? State of Economy Probability of State of Economy Rate of Return if State Occurs Recession . …. 233. 11. There are 2 steps to solve Here’s the best way to solve it. Given the following information, what is the Calculate the return and standard deviation for the following stock, in an economy with five possible states. 214 22. 12 Recession Normal Boom 0. 50 % Normal 0. 40 30% Normal growth . 47% b. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e. 10 a. 73% -8. 333% chance of occurring. 5 Boom:0. 27 State Probability Stock A Stock B Recession 0. 3 Standard deviation (4 marks) Here’s the best way to solve it. 10 Boom 0. Question: Consider the following information: Rate of Return if State Occurs Probability of State of Economy . 4 percent in a recession, a return of 12. 4. 17 . What are the expected rate of return and standard deviation of the portfolio? (Do not round intermediate calculations. 090 - . Calculate the standard deviation for each stock. 26 a. Below is the predicted return in 3 different states. 41 percent Question: 3. 36% -10. 60 . 27 a. If a Good (Probability=25%) economy occurs, then the expected return is 25%. What is the standard deviation of the stock's returns? Question: 4. Finance questions and answers. 00. 223. 60 in stocks and 0. 7 percent in a boom. 16 Normal . (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places There is 26 percent probability of a recession, 43 percent probability of normal economy, and 31 percent probability of boom. 0 % Recession Normal economy 12. 0013 0. 123 . 16 . 17 Stock B -. Given the following information, what is the standard deviation for this stock? Probability. 20 -10% What is the expected standard deviation for GM stock? A. Question: Based on the following information, what is the standard deviation of returns? State of Economy Probability of State of Economy Rate of Return if State Occurs Recession . Expert-verified. 30|-9% Normal|. 98% (45 ratings) Ans Stock A expected return 10. The probabilities of a boom, normal economy, and a recession are 2 percent, 93 percent, and 5 percent, respectively. 09 −. 4 percent in a normal economy, and a return of 28. What is the standard deviation on the security? (6 marks) iii. 16. 17 Stock B (0. 0206 = . What is the standard deviation of the expected returns? Assume that an economy can have four states: Severe recession, Mild recession, Normal growth, Boom. 06 percent 13 percent . 10 15 -. 23 What is the standard deviation of Orange? Finance. 15 Normal 0. There is a 25% chance the economy will boom and a 25% chance of a recession. 21 Boom . 50 0. 5(0) + . 113 Normal . What is the standard deviation of the stock's returns? A stock will have a loss of 14. How much is the annual standard deviation of the portfolio returns? Question: Based on the following information, what is the standard deviation of returns? State of Economy Recession Normal Boom Probability of State of Economy . 126 Total 9. nk rd uc ac cm ri ak wk ej fv