An asset has an average return of 10.73 percent and a standard deviation of 20.70 percent. What range of returns should you expect to see with a 95 percent probability?    Multiple Choice   −9.97% to 31.43%   −51.37% to 72.83%   −30.67% to 52.13%   −20.32% to 41.78%   −9.97% to 11.49%

Q: An investment has a 20% chance of producing a 25% return, a 60%chance of producing a 10% return, and…

A: Computation:

Q: Asset P has a beta of 0.9. The risk-free rate of return is 8 percent, while the return on the market…

A: The asset required rate of return can be calculated with the help of CAPM equation

Q: An investor recorded the following annual returns of one of his investments. You are required to…

A: The basic purpose of investment is to earn return on the invested capital. A rational investor will…

Q: Asset M Asset N j P?? Return, ??   P?? Return, ??   1   0.25   10%     0.15   10%…

A: Standard deviation is calculated to know about the volatility of an asset, it is the square root of…

Q: Asset Y has a beta of 1.2. The risk-free rate of return is 6 percent, while the return on the market…

A: In this question we need to compute the asset's market risk premium. We can solve this question…

Q: Over a particular period, an asset had an average return of 6.7 percent and a standard deviation of…

A: The expected return is the gain or loss that a trader predicts on a particular previous rate of…

Q: Over a particular period, an asset had an average return of 5.8 percent and a standard deviation of…

A: The range in statistics is used as a dispersion measuring tool that provides an interval not…

Q: The information about asset X and Y are given as follows: Expected Standard Asset Return Deviation…

A: Here, Expected Return of X is 10% Standard Deviation X IS is 4% Expected Return of Y is 15% Standard…

Q: ver a particular period, an asset had an average return of 11.6 percent and a standard deviation of…

A: The expected range of returns refers to the range in which an investor expects the returns from an…

Q: Suppose the returns on an asset are normally distributed. The historical average annual return for…

A: The normal distribution is used for calculating the return of a continuous variable when the data is…

Q: Four assets have the following distribution of returns. Probability…

A: ACCORDING TO THE RULE,WE WILL ANSWER THE FIRST THREE SUBPARTS ONLY. FOR THE REMAINING SUBPARTS,…

Q: Normal probability distribution    Assuming that the rates of return associated with a given asset…

A:

Q: Two assets, Q & R, each have a standard deviation of 10%. Asset Q's expected return is 8.5% and…

A: The rate of return that an investor is expected to earn from the investment is term as the expected…

Q: What is the coefficient of variation (CV) of an asset with expected return 5% and standard deviation…

A: The coefficient of variation is used by investors in determining how much risk or volatility is…

Q: For investment A, the probability of the return being 20.0% is 0.5, 10.0% is 0.4, and -10.0% is 0.1…

A: Probability Return 0.5 20% 0.4 10% 0.1 -10%

Q: Over a particular period, an asset had an average return of 6.3 percent and a standard deviation of…

A: From the perspective of finance, the concept of standard deviation can help investors to quantify…

Q: Consider two assets. Suppose that the return on asset 1 has expected value 0.05 and standard…

A: Portfolio refers to basket of different financial assets in which investment is made by single…

Q: D modified) rnatives have the following returns and standard deviations of returns. Returns:…

A: Co-efficient of Variance - This represent the propotionate risk. When both return and risk are…

Q: Assume that the short-term risk-free rate is 3%, the market index S&P500 is expected to pay returns…

A: To calculate expected return CAPM is used. CAPM stands for capital asset pricing model.

Q: Suppose the returns on an asset are normally distributed. The historical average annual return for…

A: Here, Historical Average Annual Return is 5.7% Standard Deviation is 18.3%

Q: The expected annual returns are 15% for investment 1 and 12% for investment 2. The standard…

A: Here, Expected Annual Return of Investment 1 is 15% Expected Annual Return of Investment 2 is 12%…

Q: Assume that the short-term risk-free rate is 3%, the market index S&P500 is expected to pay returns…

A:

Q: Assume that the short-term risk-free rate is 3%, the market index S&P500 is expected to pay returns…

A:

Q: Assume that we have three assets.  The first one has expected return μ1 = 10% and standard…

A: Standard deviation of an asset denotes the variability in return of the asset. Higher will be the…

Q: An asset has an average return of 10.11 percent and a standard deviation of 19.02 percent. What…

A: Here we will apply the empirical rule in finance using the statistical principles. As per the…

Q: The expected annual returns are 15% for investment 1 and 12% for investment 2. The standard…

A: An investor would always analyze the risk and return of all available investment options before…

Q: Asset 1 has a standard deviation of returns of 0.15 while Asset 2 has a standard deviation of…

A: The covariance of return is product of coefficient of correlation and standard deviations of two…

Q: Example 9: What is the portfolio standard deviation for a two-asset portfolio comprised of the…

A: Weight in asset A (Wa) = 40000 / (40000 + 60000) = 0.4 Weight in asset B (Wb) = 1 - 0.4 = 0.6…

Q: The expected value and the standard deviation of returns for asset A is   12.7% and 2.3% 12.7% and…

A: Expected return = Sum of weighted probability return. Standard deviation = Square root of variance.

Q: Assuming that the rates of return associated with a given asset investment are normally distributed;…

A: a) Calculation of standard deviation:Standard deviation is 0.3516.Standard deviation can be derived…

Q: Suppose the returns on an asset are normally distributed. The historical average annual return for…

A: Given: Average return µ = 6.4% Standard deviation σ = 12.4% A) Range of return at 95% will be:…

Q: three assets.  The first one has expected return of 10% and standard deviation of return of 0.14.…

A: Every asset has some probability and return so that it's expected return (mean) and risk ( standard…

Q: Determine which of A or B is over-valued or undervalued.

A: Stock value (Intrinsic value): It is the true estimated value of a stock and if the intrinsic value…

Q: d. The beta for an asset with a required return of 19.559% when the risk-free rate and market return…

A: The capital asset pricing model is the model of valuing the required rate of return of a stock an…

Q: Over a particular period, an asset had an average return of 5.2 percent and a standard deviation of…

A: In we have to use 95% confidence interval to get the range.

Q: onsider two different assets. Asset A has a mean expected return of 6% with a standard deviation of…

A: The given problem can be solved using the concept of coefficient of variation. Coefficient of…

Q: ments, X and Y. If each investment is carried out, there are four pos outcomes. The present value of…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: If the correlation between an asset and the market is 0.6, the standard deviation of the asset is…

A: The provided information is: Correlation between an asset and the market = 0.6 Standard deviation of…

Q: Q5. You are considering two assets with the following characteristics. Return Standard deviation…

A: Standard deviation is a variation in the mean value of given data. Standard deviation is a…

Q: d) Assume that the short-term risk-free rate is 3%, the market index S&P500 is expected to pay…

A:

Q: What range of returns should you expect to see with a 99 percent probability on an asset that has an…

A: At 99% level, value of z = 3 Expected range of return = Average return + (Value of z * Standard…

Q: The expected value, standard deviation of returns, and coefficient of variation for asset A are…

A: To Find: Expected return Standard deviation COV

Q: ange of returns should you expect to see with a 99 percent probability on an asset that has an…

A: At 99% level, value of z = 3 Expected range of return = Average return + (Value of z * Standard…

Q: The asset's market risk premium is

A: Market risk premium = Return on market portfolio - Risk free rate of return

Q: What range of returns would you expect to see 68 percent of the time for this asset? (A negative…

A: The rate of return is the net gain or loss of an investment over a specific time period, represented…

Q: market

A: Systematic risk refers to the type of risk which has an impact on the entire market. Also known as…