The common stock of Escapist Films sells for $40 a share and offers the following payoffs next year:
Dividend Stock Price
Boom 0 $26
Normal economy $3 41
Recession 5 51
All three scenarios are equally likely.
a. Calculate the expected return of Escapist. (Negative values should be indicated by a minus sign.)
Expected Return _______
Boom % __________
Normal economy % ________
Recession % _____________
b. Calculate the standard deviation of Escapist. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Standard deviation % _________________