Instruction 5 -Referring to Instruction 5

question 96

Short Answer

Instruction 5.3
There are two houses with almost identical characteristics available for investment in two different neighbourhoods with drastically different demographic composition. The anticipated gain in value when the houses are sold in 10 years has the following probability distribution:
Returns
$$\begin{array} { | c | c | c | } \hline \text { Probability } & \text { Neighbourhood A } & \text { Neighbourhood B } \\\hline 0.25 & - \$ 22,500 & \$ 30,500 \\\hline 0.40 & \$ 10,000 & \$ 25,000 \\\hline 0.35 & \$ 40,500 & \$ 10,500 \\\hline\end{array}$$
-Referring to Instruction 5.3,what is the expected value gain if you invest in both houses?

---

Definitions:

Cash Dividend

A payment made by a corporation to its shareholders, usually as a distribution of profits.

Date of Record

The specific date set by a corporation on which the shareholders of record are identified and entitled to receive dividends or distributions.

Shareholder's Investment

The total amount of money that shareholders have invested in a company.

Repurchase

A Repurchase is the act of buying back previously sold assets or securities by the company or issuer.