What is the expected return for Stock A?
Stock A Return: 33% 20% 15% 0%
Stock B Return: 60% 30% 5% -20%
Probability: 0.1 0.2 0.4 0.3
Use these numbers for Question
A. 9.2%
B. 10.2%
C. 11.3%
D. 12.3%
E. 13.3%
Part B) What is the expected return for Stock B?
A. 8.0%
B. 8.7%
C. 9.4%
D. 10.3%
Part C) What is the expected return of a portfolio consisting of 50 percent of each stock?
A. 10.12%
B. 10.65%
C. 11.37%
D. 11.92%
Part D) What is the coefficient of variation (CV) for Stock A? Hint: the standard deviation of Stock A is 10.1%.
A. 0.62
B. 0.76
C. 0.87
D. 0.92