You have been given this probability distribution for the holding-period return for KMP stock: $\begin{array}{lll}
\underline{\text { State of the Economy }} & \underline{\text { Probability }} &\underline{ \text { HPR } }\
\text { Boom } & .30 & 18\% \
\text { Normal growth } & .50 & 12\%\
\text { Recession } & .20 & -5\%
\end{array}$

-What is the expected variance for KMP stock?
A)66.04%
B)69.96%
C)77.04%
D)63.72%
E)78.45%

Question

You have been given this probability distribution for the holding-period return for KMP stock: $\begin{array}{lll}
\underline{\text { State of the Economy }} & \underline{\text { Probability }} &\underline{ \text { HPR } }\
\text { Boom } & .30 & 18\% \
\text { Normal growth } & .50 & 12\%\
\text { Recession } & .20 & -5\%
\end{array}$

-What is the expected variance for KMP stock?
A)66.04%
B)69.96%
C)77.04%
D)63.72%
E)78.45%

Quizplus · Accepted Answer

The Answer is A

You Have Been Given This Probability Distribution for the Holding-Period