Question 1:
Mr Anderson has received a large number of shares as part of his inheritance fro his late mothers estate.
|
State of the economy
|
Probability
|
Estimated return
|
|
Boom
|
0.10
|
25%
|
|
Growth
|
0.20
|
10%
|
|
Stable
|
0.50
|
15%
|
|
Recession
|
0.20
|
-12%
|
Calculate the expected return
The standard deviation
The variance