The Rate of Return on the Common Stock of Flowers

question 25

Multiple Choice

The rate of return on the common stock of Flowers by Flo is expected to be 14% in a boom economy, 8% in a normal economy, and only 2% in a recessionary economy. The probabilities of these economic states are 20% for a boom, 70% for a normal economy, and 10% for a recession. What is the variance of the returns on the common stock of Flowers by Flo?

• A) 0.001044
• B) 0.001280
• C) 0.001863
• D) 0.002001
• E) 0.002471

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Definitions:

Podocytes

Specialized cells in the kidney that wrap around capillaries of the glomerulus, playing a key role in the filtration barrier.

Simple Squamous Epithelial Cells

Single-layered, flat cells found lining surfaces involved in diffusion or filtration, such as blood vessels and lung alveoli.

Glomerular Capsule

A double-layered structure surrounding each glomerulus in the nephron of the kidney, involved in the filtration of blood to form urine.

Renal Tubule

A tiny tube in the kidney where reabsorption of water, ions, and nutrients occurs, and waste products are secreted.