Question

In: Finance

Taggart Inc.'s stock has a 50% chance of producing a 25% return, a 30% chance of...

Taggart Inc.'s stock has a 50% chance of producing a 25% return, a 30% chance of producing a 10% return, and a 20% chance of producing a −28% return.

a. What is their expected rate of return?

b. What is their standard deviation of returns?

c. What is their coefficient of variation?

Solutions

Expert Solution

Solution


Related Solutions

Dothan Inc.'s stock has a 25% chance of producing a 16% return, a 50% chance of...
Dothan Inc.'s stock has a 25% chance of producing a 16% return, a 50% chance of producing a 12% return, and a 25% chance of producing a -18% return. What is the firm's expected rate of return? Do not round your intermediate calculations. a. 4.51% b. 4.29% c. 5.50% d. 4.68% e. 6.38%
Stock has a 25% chance of producing a 36% return, a 50% chance of producing a...
Stock has a 25% chance of producing a 36% return, a 50% chance of producing a 12% return, and a 25% chance of producing a -18% return. What is the firm's standard deviation?  Do not round your intermediate calculations.
ABC Inc.'s stock has a 30% chance of producing a 10% return, a 40% chance of...
ABC Inc.'s stock has a 30% chance of producing a 10% return, a 40% chance of producing a 0% return, and a 30% chance of producing a -5% return. What is the firm's expected rate of return?
Scenario Modeler’s prospective stock has a 15% chance of producing a 65% return, a 25% chance...
Scenario Modeler’s prospective stock has a 15% chance of producing a 65% return, a 25% chance of producing a 22% return, a 40% chance of producing a 7% return, and a 20% chance of producing a –24% return. What is the firm’s coefficient of variation of return? Enter your answer rounded to two decimal places. For example, if your answer is 12.345 then enter as 12.35 in the answer box.
1. A firm's stock has 50% chance of a 13% rate of return and a  50% chance...
1. A firm's stock has 50% chance of a 13% rate of return and a  50% chance of a 20% rate of return. What is the standard deviation of return for this stock? Answer as a percent return  to the nearest hundredth of a percent as in xx.xx without entering a percent symbol.   2. A firm's stock has 50% chance of a 35% rate of return. a 30% chance of a 18% rate of return. and a 20% chance of a -24%...
8. Your investment has a 20% chance of earning a 25% rate of return, a 50%...
8. Your investment has a 20% chance of earning a 25% rate of return, a 50% chance of earning a 12% rate of return and a 30% chance of losing 10%. What is your expected return on this investment? What is the standard deviation? What is the coefficient of variation?
1. Taggart Transcontinental’s stock has a volatility of 25% and a current stock price of $40...
1. Taggart Transcontinental’s stock has a volatility of 25% and a current stock price of $40 per share. Taggart pays no dividends. The risk-free interest rate is 4%. (a). Calculate the Black-Scholes value of a one-year, at-the-money call option on Taggart stock. The value of a one-year, at-the-money call option on Taggart stock is _______$ (round to two decimal places) (b). Calculate the Black-Scholes value of a one-year, at-the-money put option on Taggart stock. The value of a one-year, at-the-money...
Taggart Transcontinental’s stock has a volatility of 25% and a current stock price of $40 per...
Taggart Transcontinental’s stock has a volatility of 25% and a current stock price of $40 per share. Taggart pays no dividends. The risk-free interest rate is 4%. (a). Calculate the Black-Scholes value of a one-year, at-the-money call option on Taggart stock. The value of a one-year, at-the-money call option on Taggart stock is__________ $ (round to two decimal places) (b). Calculate the Black-Scholes value of a one-year, at-the-money put option on Taggart stock. The value of a one-year, at-the-money put...
You believe Orange, Inc. stock has a 20% chance of making 11%, a 30% chance of...
You believe Orange, Inc. stock has a 20% chance of making 11%, a 30% chance of making 16% and a 50% chance of losing 6%. What is the standard deviation of Orange, Inc. stock return? 10.15% 32.82% 13.73% 4.36%
Your investment has a 20% chance of earning a 26% rate of return, a 50% chance...
Your investment has a 20% chance of earning a 26% rate of return, a 50% chance of earning a 15% rate of return and a 30% chance of losing 9%. What is your expected return on this investment? Enter answer in percents, accurate to two decimal places.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT