Please explain this. I don't get what it means by an equal difference over an equal interval!!!
1 answer:
You might be interested in
Answer:
C)A is 15.95% ,B is 11.85%
Step-by-step explanation:
We know that the expected value in probability distribution is given as
Lets X is the expected value then
For stock A
X=0.25 x 0.45+0.14 x 0.25+0.04 x 0.3
X=0.1595
So the expected return for A is 15.95%
For stock 9
X=0.3 x 0.3+0.09 x 0.25+0.02 x 0.3
X=0.1185
So the expected return for B is 11.85%
So our option C will be the answer of that problem.