A company is considering investing in a project that has an expected return of 12% per year.
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A company is considering investing in a project that has an expected return of 12% per year. However, the project is also subject to some risk. The company's risk management team estimates that there is a 20% chance that the project will lose money in any given year, and a 80% chance that it will earn the expected return. If the project loses money, the estimated loss is 20% of the investment amount. What is the expected return on the project, taking into account the risk, and what is the standard deviation of the returns?
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