Roenfeld Corp believes the following probability distribution exists for its stock. What is the coefficient of variation on the
1 answer:
Complete question is attached;
Answer:
Option D: 0.3069
Step-by-step explanation:
Formula for coefficient of variation on the company's stock is;
CV = σ/E(r)
Where σ is the standard deviation and E(r) is expected value of return.
From the attached image, we can find E(r) as;
E(r) = 0.45(25) + 0.5(15) + 0.05(5)
E(r) = 19%
From online calculation, the standard deviation is 5.83%
Thus;
CV = 5.831/19
CV ≈ 0.3069
You might be interested in
Answer:
Therefore either a:b = 5:4 or a:b=-5:4
Step-by-step explanation:
ax²-5bx+4a=0
Since the quadratic equation has two real root.
Then b²-4ac>0
Here a= a , b= -5b and c=4a
∴(-5b)²-4.a.4a=0
⇔25b²=16a²
⇔5b=±4a
Therefore either a:b = 5:4 or a:b=-5:4