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You Are Considering Buying a Share of Stock in a Firm

question 23

Multiple Choice

You are considering buying a share of stock in a firm that has the following two possible payoffs with the corresponding probability of occurring.The stock has a purchase price of $50.00.You forecast that there is a 40% chance that the stock will sell for $70.00 at the end of one year.The alternative expectation is that there is a 60% chance that the stock will sell for $30.00 at the end of one year.What is the expected percentage return on this stock,and what is the standard deviation of returns on this stock?


Definitions:

Oxygen Deficit

The lack of oxygen supply in muscles during the early stages of exercise, leading to anaerobic energy production.

Chemical Pathway

A sequence of chemical reactions occurring within a cell that leads to a specific product or change in the cell.

Exercise

Exercise designed intentionally, organized, and repeated to condition any body part.

Oxygen Deficit

The difference between the amount of oxygen needed for totally aerobic muscle activity and the actual amount used, leading to an early fatigue.

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