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Financial analysts have estimated the returns on shares of Drucker Corporation and the overall market portfolio under various economic conditions as follows. The return for Drucker in the following three economic states of nature are
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- Financial analysts have estimated the returns on shares of the Goldday Corporation and the overall market portfolio under two economic states nature as follows. For Goldday the state dependent returns are -0.06 in recession, and 0.10 in an economic boom. For the market the state dependent returns are -0.08 in recession,and 0.18 in boom. The analyst estimates that the probability of a recession is 0.50 while the probability of an economic boom is 0.50. Compute the standard deviation of the market._____________ * State your answer in decimal form, working your analysis using at least four decimal places of accuracy.Financial analysts have estimated the returns on shares of the Goldday Corporation and the overall market portfolio under two economic states nature as follows. For Goldday the state dependent returns are -0.06 in recession, and 0.10 in an economic boom. For the market the state dependent returns are -0.12 in recession, and 0.16 in boom. The analyst estimates that the probability of a recession is 0.50 while the probability of an economic boom is 0.50. Compute the beta of Goldday. * State your answer in decimal form, working your analysis using at least four decimal places of accuracy.Financial analysts have estimated the returns on shares of the Goldday Corporation and the overall market portfolio under two economic states nature as follows. For Goldday the state dependent returns are -0.04 in recession, and 0.10 in an economic boom. For the market the state dependent returns are -0.12 in recession,and 0.14 in boom. The analyst estimates that the probability of a recession is 0.50 while the probability of an economic boom is 0.50.Compute the standard deviation of the market.
- You may attempt this question 3 more times for credit Financial analysts have estimated the retums on shares of Drucker Corporation and the overall market portfolio under various economic conditions as follows. The return for Drucker in the following three economic states of nature are forecasted to be -20% in recession, +9% in moderate growth, and +33% in a boom. Estimates for the market as a whole in the same economic states are -10% in recession, +9% in moderate growth, and +23% in boom The analyst considers each state to be equally likely What is the expected return for Drucker Corporation? 1% What is the expected return of the market? Place your answers in percentage form (NOTE: NOT DECIMAL FORM) using two decimal places and no percentage sign. For example, an answer of five point five five percent would be entered 5.55 CHECK ANSWERFinancial analysts have estimated the returns on shares of the Goldday Corporation and the overall market portfolio under two economic states nature as follows. For Goldday the state dependent returns are -0.06 in recession, and 0.08 in an economic boom. For the market the state dependent returns are -0.12 in recession, and 0.16 in boom. The analyst estimates that the probability of a recession is 0.50 while the probability of an economic boom is 0.50. Compute the covariance between Goldday and the market. * State your answer in decimal form, working your analysis using at least four decimal places of accuracy.Please include the excel formula You’ve observed the following returns on Pine Computer’s stock over the past five years: 8 percent, −12 percent, 14 percent, 21 percent, and 16 percent. Suppose the average inflation rate over this period was 3.1 percent and the average T-bill rate over the period was 3.9 percent. What was the average real return on the company’s stock? What was the average nominal risk premium on the company’s stock over this period? Input area: Year Returns 1 8% 2 -12% 3 14% 4 21% 5 16% Average inflation 3.10% Average T-bill rate 3.90% (Use cells A6 to B13 from the given information to complete this question. You must use the built-in Excel function to answer this question. Make sure to use the “sample” Excel formula.)…
- Answer(s): (Your response(s) are in the boxes.) Financial analysts have estimated the returns on shares of the Goldday Corporation and the overall market portfolio under two economic states nature as follows. For Goldday the state dependent returns are -0.06 in recession, and 0.10 in an economic boom. For the market the state dependent returns are -0.08 in recession, and 0.18 in boom. The analyst estimates that the probability of a recession is 0.50 while the probability of an economic boom is 0.50. Compute the covariance between Goldday and the market. .7111 *State your answer in decimal form, working your analysis using at least four decimal places of accuracy. RESUBMIT ANSWERwsparon mure Financial analysts have estimated the retums on shares of the Woods Corporation and the overall market portfolo under two economic states nature as follows For Woods the state dependent returns are -0.02 in recession, and 0.05 in an economic boom. For the market the state dependent retums are -0.06 in recession, and 0.12 in boom. The analyst estimates that the probability of a recession is 0.50 while the probability of an economic boom le 0.50 Compute the covenance between Woods and the market *State your answer in decimal form, working your analysis using at least five decimal places of accuracy CHECK ANSWERCompany A's historical returns for the past three years are 6 percent, 15 percent, and 15 percent. Similarly, the market portfolio's returns were 10 percent, 10 percent, and 16 percent. Suppose the risk-free rate of return is 4 percent and that investors expect the market to return 10 percent. What is the cost of equity capital (required rate of return of company A's common stock), computed with the CAPM? Multiple Choice A)10% B) 14% C) 8.5% D) 12% Please show your work
- What is the expected return on a stock if the firm will earn 24% during a period of economic boom, 14% during normal economic periods, and 2% during a period of recession if the probabilities of these economic environment are 20%, 65% and 15%, respectively?Investment advisors estimated the stock market returns for four market segments: computers, financial, manufacturing, and pharmaceuticals. Annual return projections vary depending on whether the general economic conditions are improving, stable, or declining. The anticipated annual return percentages for each market segment under each economic condition are as follows: Assume that an individual investor wants to select one market segment for a new investment. A forecast shows improving to declining economic conditions with the following probabilities: improving (0.2), stable (0.5), and declining (0.3). What is the preferred market segment for the investor, and what is the expected return percentage? At a later date, a revised forecast shows a potential for an improvement in economic conditions. New probabilities are as follows: improving (0.4), stable (0.4), and declining (0.2). What is the preferred market segment for the investor based on these new probabilities? What is the expected return percentage?Use the extended DuPont equation to provide a breakdown of Computrons projected return on equity. How does the projection compare with the previous years and with the industrys DuPont equation?
