The rate established prior to the beginning of a period that uses estimated overhead and an allocation factor such as estimated
1 answer:
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Answer: The standard deviation of the stock is 3.23 percentage
Explanation:
First we shall calculate the epected weighted average return of the stock.
We shall multiply the probability of the scenario with its expected return and then take the sum of the expected returns of different scenarios,
E(x) = (0.2 x 14%) + (0.7 x 8%) + (0.1 x 2%)
E(x) = 8.6%
We shall use the follwing formula to calculate the Variance of the stock,
σ²(x) = ∑ P() × [
- E(r)]²
σ²(x) = (0.2) (0.14 - 0.086)² + (0.7) (0.08 - 0.086)² + (0.1) (0.02 - 0.086)²
σ²(x) = 0.001044
To find the standar deviation,
σ(x) =
σ(x) = 0.0323109
in percentage it would be 3.23%
Answer:
1.93%
Explanation:
The time weighted rate of return will be computed by combining the return at every time period demarcated by a withdrawal/addition.
<em>Time 1: Jan 1, 2016 to Sep 30, 2016</em>
start value = 100,000; end value = (105,000+5,000) = 110,000
Return =
<em>Time 2: Sep 30, 2016 to Sep 30, 2017</em>
start value = 105,000; end value = 108,000
Return =
<em>Time 3: Sep 30, 2017 to Dec 31, 2017</em>
start value = (108,000 + 3,000) = 111,000; end value = 100,000
Return = .
Therefore, time weighted return
= (1.1 * 1.028571 * 0.900901) - 1
= 0.019305
= 1.93%.