Assume the Probability of a Pessimistic,most Likely and Optimistic State

question 120

Multiple Choice

Assume the probability of a pessimistic,most likely and optimistic state of nature is .25,.55 and .20,and the returns associated with those states of nature are 5%,10%,and 13% for asset Y.Based on this information,the expected return,standard deviation,and coefficient of variation for asset Y are:

• A)10.50%,2.96% and 0.395 respectively
• B)10.35%,2.86% and 0.345 respectively
• C)9.55%,2.76% and 0.315 respectively
• D)9.15%,2.66% and 0.295 respectively
• E)none of the above

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Definitions:

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A substance that originates from living entities or is produced through organic processes.

Reaction

A process in which substances, the reactants, transform into different substances, the products, through a chemical change.

Reaction

A process in which substances, the reactants, undergo chemical changes to form new substances, known as products.

Product

The substances that result from the completion of a chemical reaction.