A Stock Has an Annual Standard Deviation of 14

question 93

Multiple Choice

A stock has an annual standard deviation of 14.1 percent and an expected annual return of 11.5 percent.What is the smallest expected loss for the next 6 months given a probability of 2.5 percent?

• A) −8.90 percent
• B) −13.79 percent
• C) −14.57 percent
• D) −15.38 percent
• E) −16.67 percent

---

Definitions:

Adjusting Entries

At the conclusion of an accounting cycle, entries recorded to distribute earnings and costs to the appropriate period they occurred.

Internal Transactions

Transactions that occur within a company, affecting its financial or operational position without involving an exchange with external entities.

Account Balances

The total amount of money in an account, calculated by adding all credits and subtracting all debits.

Adjusting Journal Entry

Entries made in accounting records at the end of an accounting period to allocate revenue and expenses to the period in which they actually occurred.