K Corporation is considering investing in Malaysian security market. The company needs to choose only one...

  

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K Corporation is considering investing in Malaysian security market. The company needs to choose only one from the two securities listed below. The returns are as follows: Return Probability Security Q Security R 40% 8% 10% 20% 10% 8% 40% 7% 7% Based on the above information, you are required to: a. calculate the expected rate of return for each security. (2 Marks) b. calculate the standard deviation of return for each security. (4 Marks) c. justify the most preferable security based on your calculation in part (a) and (b). (4 Marks) (Total: 10 Marks) K Corporation is considering investing in Malaysian security market. The company needs to choose only one from the two securities listed below. The returns are as follows: Return Probability Security Q Security R 40% 8% 10% 20% 10% 8% 40% 7% 7% Based on the above information, you are required to: a. calculate the expected rate of return for each security. (2 Marks) b. calculate the standard deviation of return for each security. (4 Marks) c. justify the most preferable security based on your calculation in part (a) and (b). (4 Marks) (Total: 10 Marks)

Answer rating: 100% (QA)

a Calculate the expected rate of return for each security Security Q Return Probability x R... View the full answer