Question: Performance and deviation Description: Buy a security for $100 that will pay you $7 in cash and will be worth $106 a year later. The

Performance and deviation Description: Buy a security for $100 that will pay you $7 in cash and will be worth $106 a year later. The return would be ($7 + $6)/$100. Calculate the expected return. Use the following formula:

Look for the expected performance. Use the following formula:

pay you $7 in cash and will be worth $106 a year

Find the standard deviation. Use the following formula:

later. The return would be ($7 + $6)/$100. Calculate the expected return.

R=Pt1Dt+(PtPt1) =i=1n(RiR)2(Pi) R=i=1n(Ri)(Pi)

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