1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
vazorg [7]
3 years ago
7

Expected return and standard deviation. Use the following information to answer the​ questions: LOADING.... a. What is the expec

ted return of each​ asset? b. What is the variance of each​ asset? c. What is the standard deviation of each​ asset? ​Hint: Make sure to round all intermediate calculations to at least seven​ (7) decimal places. The input​ instructions, phrases in parenthesis after each answer​ box, only apply for the answers you will type. a. What is the expected return of asset​ A?

Business
1 answer:
lora16 [44]3 years ago
3 0

Answer and Explanation:

a. The computation of expected return of each​ assets is shown below:-

Expected Return on Asset A in state is

= 0.39 × 0.02 + 0.45 × 0.02 + 0.16 × 0.02

= 0.02

Expected Return on Asset B in state is

= 0.39 × 0.25 + 0.45 × 0.06 + 0.16 × -0.04

= 0.1181

Expected Return on Asset C in state is

= 0.39 × 0.35 + 0.45 × 0.19 + 0.16 × -0.22

= 0.1868

b. The computation of variance of each asset is shown below:-

Variance of Assets A is

= 0.39 × (0.02 - 0.020)^2 + 0.45 × (0.02 - 0.020)^2 + 0.16 × (0.02 - 0.020)^2

= 0

Variance of Assets B is

= 0.39 × (0.25 - 0.1181)^2 + 0.45 × (0.06 - 0.1181)^2 + 0.16 × (-0.04 - 0.1181)^2

= 0.0123

Variance of Assets C is

= 0.39 × (0.35 - 0.1868)^2 + 0.45 × (0.19 - 0.1868)^2 + 0.16 × (-0.22 - 0.1868)^2

= 0.0369

c. The computation of standard deviation of each​ asset is shown below:-

Standard Deviation of A is

= (0.39 × (0.02 - 0.020)^2 + 0.45 × (0.02 - 0.020)^2 + 0.16 × (0.02 - 0.020)^2)^0.5

= 0

Standard Deviation of B is

= (0.39 × (0.25 - 0.1181)^2 + 0.45 × (0.06 - 0.1181)^2 + 0.16 × (-0.04 - 0.1181)^2)^0.5

= 0.1109

Standard Deviation of C is

= (0.39 × (0.35 - 0.1868)^2 + 0.45 × (0.19 - 0.1868)^2 + 0.16 × (-0.22 - 0.1868)^2)^0.5

= 0.1920

You might be interested in
After preparing and posting the closing entries for revenues and expenses, the income summary account has a debit balance of $25
frosja888 [35]

If after preparing and posting the closing entries for revenues and expenses, the income summary account has a debit balance of $25,000. the entry to close the income summary account will be:  a debit of $25,000 to owner capital.

<h3>Income summary</h3>

The debit balance  of the amount of $25,000 in the income summary indicate that the company expenses is higher than the revenues generated by the company by $25,000.

Based on this the loss incurred will be taken out of the company  owner's equity  account by reducing it through a debit entry.

Therefore  the income summary account has a debit balance of $25,000. the entry to close the income summary account will be:  a debit of $25,000 to owner capital.

Learn more about income summary here:brainly.com/question/24498019

brainly.com/question/26252171

#SPJ1

8 0
2 years ago
A loss has a Debit balance and is shown on the balance sheet. A gain has a Credit balance and is shown on the balance sheet. B.
spin [16.1K]

Answer:

A gain has a Credit balance and is shown on the Income Statement. C. A loss has a Debit balance and is shown on the Income Statement.

Explanation:

As we know that the revenues and gains contains the normal credit balance while on the other hand the expenses and losses contains the normal debit balance and both are reported on the income statement

The gain would be reported on the credit side of the income statement and the loss would be reported on the debit side of the income statement

So the same is relevant too

7 0
3 years ago
How can insurance protect you from financial loss?
RUDIKE [14]

<em>Answer:</em>

<em>Answer:Insurance policies offer protection against economic loss, that is, loss or damage which can be measured in purely financial terms and compensated by money. When you buy homeowners property insurance.</em>

Explanation:

<em>When you buy homeowners property insurance, for example, you are insuring only the economic value of the home, i.e., the cost to repair or rebuild it.</em>

6 0
3 years ago
On February 12, Quality Carpet Inc., a carpet wholesaler, issued for cash 1,000,000 shares of no-par common stock (with a stated
Diano4ka-milaya [45]

Answer:

B. The invested amount is $1,410,000

Explanation:

A. The journal entry is shown below:

For February 12:

Cash A/c Dr (1,000,000 shares × $1.20) = $1,200,000

   To Common stock  (1,000,000 shares × $0.25) = $250,000

    To Paid in capital in excess of par                         $950,000

(Being common stock is issued for cash)

For August 3:

Cash A/c Dr (10,000 shares × $21) = $210,000

   To Preference stock  (10,000 shares × $15) = $150,000

    To Paid in capital in excess of par                   $60,000

(Being preference stock is issued for cash)

B. The computation of the total amount invested is shown below:

Common stock = $250,000

Add: Preferred stock = $150,000

Add: Additional paid up capital of common stock = $950,000

Add: Additional paid up capital of Preference stock =  $60,000

So, the invested amount is $1,410,000

8 0
3 years ago
Steve Jobs was a demanding perfectionist when it came to his business. In fact, the case recounts instances where Jobs would hav
Lapatulllka [165]
Based on the given description above about Steve Jobs, among the five big personality dimensions, the type of behavior that Steve Jobs seem to be most related to is LOCUS OF CONTROL. This kind of behavior is manifested by someone who believes that their actions can highly influence the impact or result of their tasks.
6 0
3 years ago
Other questions:
  • In its Declaration of Secession, South Carolina uses the Declaration of Independence to establish:
    5·1 answer
  • Which of the following would an economist most likely classify as a need?. A.gasoline for a florist's delivery truck.. B. a coll
    13·2 answers
  • 1. What have been your most positive and negative management experiences?
    12·1 answer
  • When sam goes to a restaurant, he always tips the server $2 plus 10% of the cost of the meal. if sam’s distribution of meal cost
    7·1 answer
  • Paul sells one parcel of land (basis of $100,000) for its fair market value of $160,000 to a partnership in which he owns a 60%
    11·1 answer
  • You decide to buy 1,300 shares of stock at a price of $36 and an initial margin of 65 percent.
    9·1 answer
  • Pleaseeee help me
    9·1 answer
  • Which of the following statements is CORRECT? Assume that the project being considered has normal cash flows, with one outflow f
    6·1 answer
  • The process for applying for a work permit at the Manchester department of labor is as follows. First, the administrator fills o
    7·1 answer
  • On July 1, 2021, Ross-Livermore Industries issued nine-month notes in the amount of $400 million. Interest is payable at maturit
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!