A fruit company has 20% returns in periods of normal rainfall and -3% returns in droughts....

A fruit company has 20% returns in periods of normal rainfall and -3% returns in droughts. The probability of normal rainfall is 60% and droughts 40%. What would the fruit company’s expected returns be?

24%

10.8%

0

1.1 %

Expert Solution

Expected return=Respective return*Respective probability

=(0.6*20)+(0.4*-3)

which is equal to

=10.8%

jeff jeffy answered 2 years ago

The annual rainfall in a region has a normal distribution with a mean rainfall of 50...

The annual rainfall in a region has a normal distribution with a mean rainfall of 50 inches and a standard deviation of 10 inches. what is the probability that the total rainfall of four randomly picked years will exceed 220 inches?

Rainfall rates for successive 20-min periods of a 140-min storm are 1.5, 1.5, 6.0, 4.0, 1.0,...

Rainfall rates for successive 20-min periods of a 140-min storm are 1.5, 1.5, 6.0, 4.0, 1.0, 0.8, and 3.2 in/hr, totaling 6.0 in. Determine the rainfall excesses for successive periods by the Green-Ampt model and then report the cumulative storm runoff [in] below. Assume a saturate hydraulic conductivity of 0.8 in/hr, a porosity of 0.62, an initial moisture content of 0.28, and an average capillary suction of 7.2 in. The depression storage is 0.5 in.

The average annual rainfall in City A is 20 inches, with a standard deviation of 3...

The average annual rainfall in City A is 20 inches, with a standard deviation of 3 inches. The annual rainfall in City B is 45 inches, with a standard deviation of 12 inches. In a given year, City A received 25 inches, while City B received 55 inches. Assuming both rainfall distributions are approximately normal, which city had the wettest year relative to its average distribution? a.City A b.City B c.The cities had equally wet years d.Cannot tell from the...

A company will earn 10% returns in a poor economy, 15% returns in a normal economy,...

A company will earn 10% returns in a poor economy, 15% returns in a normal economy, and 25% returns in a booming economy. What is the standard deviation if there is a 25% chance of a poor economy and a 25% chance of a booming economy? 5.45% 4.91% 10.83% 11.18% 6.12%

Here are the returns on two stocks. Digital Cheese Executive Fruit January +18 +6 February −3...

Here are the returns on two stocks. Digital Cheese Executive Fruit January +18 +6 February −3 +2 March +5 +4 April +7 +16 May −4 +3 June +3 +6 July −2 −3 August −8 −2 Required: a-1. Calculate the variance and standard deviation of each stock. a-2. Which stock is riskier if held on its own? b. Now calculate the returns in each month of a portfolio that invests an equal amount each month in the two stocks. c. Is...

Here are the returns on two stocks. Digital Cheese Executive Fruit January +17 +7 February −3...

Here are the returns on two stocks. Digital Cheese Executive Fruit January +17 +7 February −3 +2 March +5 +4 April +7 +15 May −4 +3 June +3 +5 July −2 −3 August −8 −2 Required: a-1. Calculate the variance and standard deviation of each stock. a-2. Which stock is riskier if held on its own? b. Now calculate the returns in each month of a portfolio that invests an equal amount each month in the two stocks. c. Is...

Here are the returns on two stocks. Digital Cheese Executive Fruit January +19 +8 February −3...

Here are the returns on two stocks. Digital Cheese Executive Fruit January +19 +8 February −3 +1 March +5 +4 April +7 +17 May −4 +2 June +3 +4 July −2 −3 August −8 −2 a-1. Calculate the variance and standard deviation of each stock. (Do not round intermediate calculations. Round your answers to 2 decimal places.) a-2. Which stock is the riskier if held on its own? Digital Cheese Executive Fruit b. Now calculate the returns in each month...

Consider the following returns: 20, 10, 3, 3, -1 Will the above yield a positive or...

Consider the following returns: 20, 10, 3, 3, -1 Will the above yield a positive or a negative skewness? Show you answer both by calculation with skewness formula and in a graph.

QUESTION 3 (20 Marks) 3.1 What does normal profit mean? Explain the difference between normal profit...

QUESTION 3 3.1 What does normal profit mean? Explain the difference between normal profit and economic profit. 3.2 Explain the relationship between average product and marginal product. 3.3 In economics we consider both explicit costs and implicit costs. Differentiate between implicit and explicit costs.

QUESTION 3 (20 Marks) 3.1 What does normal profit mean? Explain the difference between normal profit...

QUESTION 3 3.1 What does normal profit mean? Explain the difference between normal profit and economic profit. 3.2 Explain the relationship between average product and marginal product. 3.3 In economics we consider both explicit costs and implicit costs. Differentiate between implicit and explicit costs. QUESTION 4 An economist needs a deep understanding of price elasticity concepts and their applicability in today’s economy. 4.1 Define price elasticity of demand and how it is measured. 4.2 Explain the FIVE (5) categories of...

Question

A fruit company has 20% returns in periods of normal rainfall and -3% returns in droughts....

Solutions

Expert Solution

Related Solutions

The annual rainfall in a region has a normal distribution with a mean rainfall of 50...

Rainfall rates for successive 20-min periods of a 140-min storm are 1.5, 1.5, 6.0, 4.0, 1.0,...

The average annual rainfall in City A is 20 inches, with a standard deviation of 3...

A company will earn 10% returns in a poor economy, 15% returns in a normal economy,...

Here are the returns on two stocks. Digital Cheese Executive Fruit January +18 +6 February −3...

Here are the returns on two stocks. Digital Cheese Executive Fruit January +17 +7 February −3...

Here are the returns on two stocks. Digital Cheese Executive Fruit January +19 +8 February −3...

Consider the following returns: 20, 10, 3, 3, -1 Will the above yield a positive or...

QUESTION 3 (20 Marks) 3.1 What does normal profit mean? Explain the difference between normal profit...

QUESTION 3 (20 Marks) 3.1 What does normal profit mean? Explain the difference between normal profit...