The Rate of Return on the Common Stock of Flowers

question 3

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) .001044
• B) .001280
• C) .001863
• D) .002001
• E) .002471

---

Definitions:

Authoritative

A parenting style characterized by high demand and high responsiveness, combining clear expectations with emotional support.

Responsive

Being quick to react or respond positively or supportively to stimuli or actions.

Romanian Children

Often refers to studies or discussions about the developmental outcomes of children from Romania, especially those who experienced institutional care.

Lower Intelligence Scores

Lower intelligence scores refer to below-average outcomes on tests designed to measure cognitive abilities and intellectual potential.