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Problem:

You are contemplating making a $7,000 investment that would have the following possible outcomes in cash flows each year.

Required:

What are the expected cash flow, the expected rate of return and the standard deviation? Please describe in detail and provide step by step solution.

Probability Cash Flows

.25 $300

.55 $675

.20 $1,200

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M91146088

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