The return on a share has the following distribution:

Calculate the expected return and standard deviation of the stock

Demand for the company's product		The probability that this demand will occur		Rate of return if this demand occurs (%)
						Weak	0.1	-50%
Below average		0.2	-5
Average	0.4	sixteen
above average		0.2	25
Strong	0.1	60
1.0

Answer rating: 100% (QA)

SOLUTION To calculate the expected return we need to multiply the rate of return for each demand level by its corresponding probability and then sum u... View the full answer