Computing the expected return and standard deviation


Please explain how to calculate the expected return and standard deviation of returns when your only given possible outcomes and probability returns.

Possible Outcomes Probability Returns (%)
Pessimistic 0.25 5
Most likely 0.55 10
Optimistic 0.20 13

Solution Preview :

Prepared by a verified Expert
Finance Basics: Computing the expected return and standard deviation
Reference No:- TGS01451490

Now Priced at $20 (50% Discount)

Recommended (98%)

Rated (4.3/5)