Braniff Ground Services stock has an expected return of 9 percent and a variance of 0.25 percent. What is the coefficient of variation for Braniff? Round your final answer to four decimal places.
A) 0.0278
B) 0.5556
C) 1.8001
D) 36.0002

Question

Quizplus · Accepted Answer

The coefficient of variation (CV) is calculated as the standard deviation of the returns divided by the expected return. In this case, the standard deviation is the square root of the variance, which is 0.5%. Therefore, the CV is 0.005 / 0.09 = 0.05556, which rounds to 0.5556. This is the only choice that matches the calculated value.

Braniff Ground Services Stock Has an Expected Return of 9