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| Teaching Since: | Apr 2017 |
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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
| Security Returns If State Occurs | |||||||||||
| State of Economy |
Probability of State of Economy |
||||||||||
| Roll | Ross | ||||||||||
| Bust | .30 | Ac€?o11 | % | 12 | % | ||||||
| Boom | .70 | 29 | 5 | ||||||||
|
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): (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 | |||||||
| Roll | |||||||||||
| Bust | .30 | ||||||||||
| Boom | .70 | ||||||||||
| A?A?2 = | |||||||||||
| Ross | |||||||||||
| Bust | .30 | ||||||||||
| Boom | .70 | ||||||||||
| A?A?2 = | |||||||||||
| Standard Deviations | |
| Roll | % |
| Ross | % |
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-----------