You are given the following probability distribution of returns for stock J: A probability of .2...
You are given the following probability distribution of returns for stock J: A probability of .2 that the return will be 12%; a probability of .35 that the return will be 18%; a probability of .3 that the return will be -10%; and a probability of .15 that the return will be 10% What is the expected return of this stock?
Homework Answers
Expected Return=Respective return*Respective probability
=(0.2*12)+(0.35*18)+(0.3*-10)+(0.15*10)
=7.2%
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