Question

The common stock of the downtowne should return 23 percent in a boom, 16 percent in a normal economy, and lose 32 percent in a recession. the probabilities of a boom, normal economy, and recession are 5 percent, 90 percent, and 5 percent, respectively. what is the variance of the returns on this stock?
a..012453

b..012914

c..011345

d..011663

e..012691

Answer 1

777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777