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University
| Teaching Since: | Apr 2017 |
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| Questions Answered: | 9562 |
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bachelor in business administration
Polytechnic State University Sanluis
Jan-2006 - Nov-2010
CPA
Polytechnic State University
Jan-2012 - Nov-2016
Professor
Harvard Square Academy (HS2)
Mar-2012 - Present
Problem 11-5
| Â | Â | Security Returns If State Occurs | |||||||||
|   State of   Economy |
Probability of   State of Economy |
 | |||||||||
| Â Â Â Â Â Â Â Â Roll | Â Â Â Â Â Â Â Ross | ||||||||||
|   Bust | .30 | Ac€?o11 | % | 12 | % | ||||||
| Â Â Boom | .70 | 29 | Â | 5 | Â | ||||||
| Â | |||||||||||
|
Calculate the standard deviations for Roll and Ross by filling in the following table (verify your answer using returns expressed in percentages as well as decimals):Â (Negative values should be indicated by a minus sign. Do not round intermediate calculations. Round your Standard deviation answers to 2 decimal places and other answers to 4 decimal places. Omit the "%" sign in your response.) |
| State of Economy |
   Probability of   State of Economy |
   Return Deviation   from Expected Return |
    Squared Return Deviation |
     Product | |||||||
| Â Â Roll | Â | Â | Â | Â | |||||||
| Â Â Â Â Bust | .30 | Â Â Â Â | Â Â | Â Â | |||||||
| Â Â Â Â Boom | .70 | Â Â Â Â | Â Â | Â Â | |||||||
| Â Â Â | Â | Â | Â | Â | |||||||
| Â | Â | Â | A?A?2Â = | Â Â | |||||||
| Â Â Â | Â | Â | Â | Â | |||||||
| Â Â Ross | Â | Â | Â | Â | |||||||
| Â Â Â Â Bust | .30 | Â Â Â Â | Â Â | Â Â | |||||||
| Â Â Â Â Boom | .70 | Â Â Â Â | Â Â | Â Â | |||||||
| Â Â Â | Â | Â | Â | Â | |||||||
| Â | Â | Â | A?A?2Â = | Â Â | |||||||
| Â Â Â | Â | Â | Â | Â | |||||||
| Â | |||||||||||
| Â | Standard Deviations |
| Â Â Roll | % |
| Â Â Ross | % |
| Â | |
S-----------tat-----------e o-----------f e-----------con-----------omy----------- Pr-----------oba-----------bil-----------ity----------- of----------- st-----------ate----------- of----------- ec-----------ono-----------my -----------Rat-----------e o-----------f r-----------etu-----------rn -----------if -----------sta-----------te -----------occ-----------urs----------- Ro-----------ll -----------Ros-----------s B-----------ust----------- 0.-----------30 ------------11-----------.00-----------% ------------12.-----------00%----------- Bo-----------om -----------0.7-----------0 2-----------9.0-----------0% -----------5.0-----------0% -----------Exp-----------ect-----------ed -----------ret-----------urn-----------