What Is the Expected Return and Standard Deviation for the Following

question 10

Multiple Choice

What is the expected return and standard deviation for the following stock?

• A) 15.49 percent;14.28 percent
• B) 15.49 percent;14.67 percent
• C) 18.80 percent;14.95 percent
• D) 18.80 percent;15.74 percent
• E) 18.80 percent';16.01 percent

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Definitions:

Compounding

The process in which an asset's earnings, from either capital gains or interest, are reinvested to generate additional earnings over time.

Future Values

The worth of an asset or money on a predetermined future date that has the same value as a certain amount presently.

Present Values

The value today of a future sum of money or cash flows, when calculated at an agreed-upon return rate.

Present Value

Present value is the current worth of a future sum of money or stream of cash flows given a specified rate of return.