An investor has two investments A and B. The investor believes that investment A is equally likely

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An investor has two investments A and B. The investor believes that investment A is equally likely to increase by $1,000 or to decrease by $1,000 by the end of the year. The investor also believes that investment B is equally likely to increase by $2,000 or decrease by $2,000 by the end of the year. Let X represents the total amount of change in investments A and B. Assume that these investments perform independent of each other. Find the probability of X.



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Corporate Finance

ISBN: 978-0134083278

4th edition

Authors: Jonathan Berk, Peter DeMarzo

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