# Expected Rate of Return for Stock Assignment | Homework For You

Stocks A and B have the following probability distributions of expected future returns:

Don't use plagiarized sources. Get Your Assignment on
Expected Rate of Return for Stock Assignment | Homework For You
Just from \$13/Page
 Probability A B 0.1 (12 %) (31 %) 0.1 5 0 0.6 11 22 0.1 18 25 0.1 37 48

1. Calculate the expected rate of return,  , for Stock B ( = 11.40%.) Do not round intermediate calculations. Round your answer to two decimal places.  %
2. Calculate the standard deviation of expected returns, σA, for Stock A (σB = 19.41%.) Do not round intermediate calculations. Round your answer to two decimal places.  %

Now calculate the coefficient of variation for Stock B. Do not round intermediate calculations. Round your answer to two decimal places.

Is it possible that most investors might regard Stock B as being less risky than Stock A?

1. If Stock B is less highly correlated with the market than A, then it might have a higher beta than Stock A, and hence be more risky in a portfolio sense.
2. If Stock B is more highly correlated with the market than A, then it might have a higher beta than Stock A, and hence be less risky in a portfolio sense.
3. If Stock B is more highly correlated with the market than A, then it might have a lower beta than Stock A, and hence be less risky in a portfolio sense.
4. If Stock B is more highly correlated with the market than A, then it might have the same beta as Stock A, and hence be just as risky in a portfolio sense.
5. If Stock B is less highly correlated with the market than A, then it might have a lower beta than Stock A, and hence be less risky in a portfolio sense.

-Select-IIIIIIIVVItem 4

3. Assume the risk-free rate is 1.5%. What are the Sharpe ratios for Stocks A and B? Do not round intermediate calculations. Round your answers to four decimal places.

Stock A:

Stock B:

Are these calculations consistent with the information obtained from the coefficient of variation calculations in Part b?

1. In a stand-alone risk sense A is more risky than B. If Stock B is less highly correlated with the market than A, then it might have a higher beta than Stock A, and hence be more risky in a portfolio sense.
2. In a stand-alone risk sense A is less risky than B. If Stock B is more highly correlated with the market than A, then it might have the same beta as Stock A, and hence be just as risky in a portfolio sense.
3. In a stand-alone risk sense A is less risky than B. If Stock B is less highly correlated with the market than A, then it might have a lower beta than Stock A, and hence be less risky in a portfolio sense.
4. In a stand-alone risk sense A is less risky than B. If Stock B is less highly correlated with the market than A, then it might have a higher beta than Stock A, and hence be more risky in a portfolio sense.
5. In a stand-alone risk sense A is more risky than B. If Stock B is less highly correlated with the market than A, then it might have a lower beta than Stock A, and hence be less risky in a portfolio sense.Get Finance homework help today

Calculate the price
Pages (550 words)
\$0.00
*Price with a welcome 15% discount applied.
Pro tip: If you want to save more money and pay the lowest price, you need to set a more extended deadline.
We know how difficult it is to be a student these days. That's why our prices are one of the most affordable on the market, and there are no hidden fees.

Instead, we offer bonuses, discounts, and free services to make your experience outstanding.
How it works
Receive a 100% original paper that will pass Turnitin from a top essay writing service
step 1
Fill out the order form and provide paper details. You can even attach screenshots or add additional instructions later. If something is not clear or missing, the writer will contact you for clarification.
Pro service tips
How to get the most out of your experience with Homework Writing Services
One writer throughout the entire course
If you like the writer, you can hire them again. Just copy & paste their ID on the order form ("Preferred Writer's ID" field). This way, your vocabulary will be uniform, and the writer will be aware of your needs.
The same paper from different writers
You can order essay or any other work from two different writers to choose the best one or give another version to a friend. This can be done through the add-on "Same paper from another writer."
Copy of sources used by the writer
Our college essay writers work with ScienceDirect and other databases. They can send you articles or materials used in PDF or through screenshots. Just tick the "Copy of sources" field on the order form.
Testimonials
See why 20k+ students have chosen us as their sole writing assistance provider
Check out the latest reviews and opinions submitted by real customers worldwide and make an informed decision.
Nursing
i requested peer reviewed nursing journals as part of my paper, however, I never received them after I requested them twice. If I had received these journals, I would have scored the quality of the paper an 10/10!!!
Customer 461063, October 30th, 2022
excellent job
Customer 456821, July 30th, 2022
Accounting
Thank you so much for the help, with your help that provided me with more time to learn the materials and do other assignments. I wish you existed back in 2005.
Customer 453041, June 3rd, 2020
Military
excellent
Customer 456821, October 4th, 2022
English 101
Thank You!
Customer 454425, June 21st, 2020
Political science
Good comparison.
Customer 457487, April 17th, 2022
Management
support is great. I am grateful to you and your company. thank you very much.
Customer 454227, April 6th, 2020
History
GOOD WORK.
Customer 463001, June 21st, 2022
Military
excellent work
Customer 456821, August 14th, 2022
Technology
Thank you for doing a great job. I really am glad that you did not use someones else work like the first person who did this did. Awesome job. Because of this I will continue to use this site!
Customer 454345, June 2nd, 2020
Excellent work. Looking forward to working with you in the future.
Customer 463467, November 10th, 2022
Other
Good content. Check APA cover page format on the student paper here https://owl.purdue.edu/owl/research_and_citation/apa_style/apa_formatting_and_style_guide/apa_sample_paper.html
Customer 462457, March 29th, 2022
11,595
Customer reviews in total
96%
Current satisfaction rate
3 pages
Average paper length
37%
Customers referred by a friend