Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. you are given the following information: state of

You are given the following information: State of Economy Return on Stock A Return on Stock...

60.1K

Verified Solution

Question

Finance

You are given the following information: State of Economy Returnon Stock A Return on Stock B Bear 0.103 -0.046 Normal 0.114 0.149Bull 0.074 0.234 Assume each state of the economy is equally likelyto happen. a. Calculate the expected return of each stock. (Do notround intermediate calculations and enter your answers as a percentrounded to 2 decimal places, e.g., 32.16.) b. Calculate thestandard deviation of each stock. (Do not round intermediatecalculations and enter your answers as a percent rounded to 2decimal places, e.g., 32.16.) c. What is the covariance between thereturns of the two stocks? (A negative answer should be indicatedby a minus sign, Do not round intermediate calculations and roundyour answer to 6 decimal places, e.g., .161616.) d. What is thecorrelation between the returns of the two stocks? (A negativeanswer should be indicated by a minus sign, Do not roundintermediate calculations and round your answer to 4 decimalplaces, e.g., .1616.)

Answer & Explanation Solved by verified expert
3.9 Ratings (578 Votes)
Please see the table below Cells colored in yellow are youranswers In the snapshot below I have    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Finance
1.2K views

Using the Weighted Average Cost of Capital in a Budgeting Decision 10) Your firm has an average-risk...

Statistics
1.2K views

A social scientist would like to analyze the relationship between educational attainment (in years of higher...

Advance Math
1.2K views

The following data set provides information on the lottery sales, proceeds, and prizes by year in...

Biology
1.2K views

Baseball Softball 1 Baseball and softball are considered 2 What is baseball and softball scored...

Basic Math
1.2K views

9 6 pt Carol Daryl and Michonne found a bag with 5 cups of M...

Statistics
1.2K views

Two Way Frequency Tables MC Students at a virtual school are allowed to sign up...

Calculus
1.2K views

Evaluate the definite integral 3 4 csc t cot t dt

Calculus
1.2K views

have a tangent line that is nearly horizontal v of must have a tangent line...

Calculus
1.2K views

23 Find the coordinate point that corresponds with the point a 1 0 b 0...

Accounting
1.2K views

Barlow Company manufactures three products-A, B, and C. The selling price, variable costs,...

Accounting
1.2K views

For a monopolist to sell an output level of 10 units, the price must be...

Accounting
1.2K views

Come-Clean Corporation produces a variety of cleaning compounds and solutions for both industrial and household...