The common stock of escapist films sells for 40 a share and, Ask an Expert

Finance

The common stock of Escapist Films sells for $40 a share and offers the following payoffs next year:

Dividend Stock Price

Boom 0 $26

Normal economy $3 41

Recession 5 51

All three scenarios are equally likely.

a. Calculate the expected return of Escapist. (Negative values should be indicated by a minus sign.)

Expected Return _______

Boom % __________

Normal economy % ________

Recession % _____________

b. Calculate the standard deviation of Escapist. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Standard deviation % _________________

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91944525

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