You have been given this probability distribution for the holding-period return for Cheese, Inc.stock: Assuming that the expected return on Cheese's stock is 14.35%, what is the standard deviation of these returns
A)4.72%
B)6.30%
C)4.38%
D)5.74%
E)None of the options

Question

You have been given this probability distribution for the holding-period return for Cheese, Inc.stock:  Assuming that the expected return on Cheese's stock is 14.35%, what is the standard deviation of these returns
A)4.72% 
B)6.30% 
C)4.38% 
D)5.74% 
E)None of the options

Quizplus · Accepted Answer

Variance = .20 × (24 - 14.35)² + .45 × (15 - 14.35)² + .35 × (8 - 14.35)² = 32.9275.Standard deviation = 32.9275^1/2 = 5.74.

You Have Been Given This Probability Distribution for the Holding-Period