You decided to invest money into a portfolio of two stocks, Snapchat and Groupon. There are...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
You decided to invest money into a portfolio of two stocks, Snapchat and Groupon. There are two possibilities for what you can earn on each of these two stocks next year, the so-called "thumbs up" state and the so-called "thumbs down" state. The details are in the table below: State of the economy "Thumbs up" state "Thumbs down" state Probability of the Snapchat stock's state of the return in each state of the economy economy 30% Proportion of money Proportion of money invested into invested into Snapchat stock = Groupon stock = 20% 80% 70% 43% 8% Groupon stock's return in each state of the economy 14% 35% GROUPON Calculate the expected return on your portfolio next year. You decided to invest money into a portfolio of two stocks, Snapchat and Groupon. There are two possibilities for what you can earn on each of these two stocks next year, the so-called "thumbs up" state and the so-called "thumbs down" state. The details are in the table below: State of the economy "Thumbs up" state "Thumbs down" state Probability of the Snapchat stock's state of the return in each state of the economy economy 30% Proportion of money Proportion of money invested into invested into Snapchat stock = Groupon stock = 20% 80% 70% 43% 8% Groupon stock's return in each state of the economy 14% 35% GROUPON Calculate the expected return on your portfolio next year.
Expert Answer:
Answer rating: 100% (QA)
The expected return on your portfolio next year is 204 Here is the work... View the full answer
Related Book For
Personal Financial Planning
ISBN: 9780357438480
15th Edition
Authors: Randy Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Posted Date:
Students also viewed these finance questions
-
Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
-
Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
-
Given the following: Cash flow from assets (CFFA) = $30 million, Dividend = $5 million, Interest = $5 million, no change in common stock. According to the cash flow identity, what is the net new...
-
What is the atomic weight of a hypothetical element consisting of two isotopes, one with mass= 64.23 amu (36.00%), and one with mass=65.32 amu ( 64.00%) ? [Topic: isotope and molecular weight] 64.93...
-
A diffuser shown in Fig P6.20 has air entering at 14.7 lbf/in 2, 540 R, with a velocity of 600 ft/s. The inlet cross-sectional area of the diffuser is 0.2 in 2. At the exit, the area is 1.75 in 2,...
-
Find the value of the sample size needed to if the confidence interval is 95% that the sample proportion and the population proportion are within 2% of each other. The sample proportion is 0.650....
-
When to use a settlement brochure?
-
A mixture of 54.5 mol% benzene in chlorobenzene at its bubble point is fed continuously to the bottom plate of a column containing two theoretical plates. The column is equipped with a partial...
-
How does transformational leadership influence organizational culture and employee engagement in dynamic work environments ?
-
The plot below shows the output response of a certain second-order process to a step change in the input. The input is initially at zero and then suddenly decreases at t = 2. The magnitude of the...
-
The Evolution of Advertising How and why it started The progressions and changes through the years How and when digital display advertising became relevant What effect will advancements like...
-
1. Modify the codegiven in the lecture for the up-counter so that it creates an up-down counter with 4 bits. The decision to countup or down is made by the value of the input signal w . If w is 0,...
-
Find the limit. == Let lim f(x) =4 and lim g(x) = -6. Find lim [f(x) - g(x)]. x-9 x-9 x-9
-
30. The stress intensity factor K at a crack is given by K=Cona where o is the far-field stress, a is the crack length, and C is a parameter that depends on the geome- try of the specimen and crack....
-
Logistics Solutions provides order fulfillment services for dot.com merchants. The company maintains warehouses that stock items carried by its dot.com clients. When a client receives an order from a...
-
A bus travels 280 km South along a straight path with an average velocity of 88 km/hr to the south. The bus stops for 24 min. Then, it travels 210 km south with an average velocity of 75 km/h to the...
-
The PT Oil Company adds chemicals to its diesel fuel oil to improve the starting performance and to reduce the freezing point. Each 1000-liter tank of diesel should contain at least 40 mg of chemical...
-
Cobb Manufacturing Company uses a process cost system and average costing. The following production data is for the month of June 2011. Production Costs Work in process, beginning of the month:...
-
During the Christmas break of his final year at the University of Florida (U of F), Aaron Barnes plans to put together his rsum in order to seek full-time employment as a software engineer during the...
-
Define and discuss (a) Demand deposits, (b) Time deposits, (c) Interest-paying checking accounts.
-
Describe how the return on an investment is calculated.
-
A domestic refrigerator consists of (a) A condenser, a compressor and an evaporator (b) A condenser, a throttling valve, a compressor and an evaporator (c) A condenser, a throttling valve and an...
-
What is the effect of pressure on equilibrium conversion of a gas-phase chemical reaction?
-
The diathermal wall (a) Is incapable of exchanging heat with the surroundings (b) Permits the full flow of heat from the system to the surroundings and vice versa (c) Both (a) and (b) (d) None of...
Study smarter with the SolutionInn App