Smallest expected gain over next year with probability

Assignment Help Financial Management
Reference no: EM13928061

A stock has an annual return of 10.4 percent and a standard deviation of 41 percent. What is the smallest expected gain over the next year with a probability of 1 percent? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)

Smallest expected gain over next year with probability of 1% = ?

Reference no: EM13928061

Questions Cloud

Under-investment problems refers to the problem : Under-investment problems refers to the problem that equity holders prefer not to invest in positive-NPV projects in highly levered firms because
What is the effective cost of borrowing in this case : Your firm has an average collection period of 27 days. Current practice is to factor all receivables immediately at a discount of 1.7 percent. What is the effective cost of borrowing in this case?
What is the npv of accepting the lockbox agreement : Your firm has an average receipt size of $130. A bank has approached you concerning a lockbox service that will decrease your total collection time by two days. You typically receive 7,200 checks per day. What is the NPV of accepting the lockbox agre..
What is daily dollar return that could be earned on savings : It takes Cookie Cutter Modular Homes, Inc., about six days to receive and deposit checks from customers. Cookie Cutter’s management is considering a lockbox system to reduce the firm’s collection times. What is the reduction in outstanding cash balan..
Smallest expected gain over next year with probability : A stock has an annual return of 10.4 percent and a standard deviation of 41 percent. What is the smallest expected gain over the next year with a probability of 1 percent?
Large non-profit health relief organization : Choice five - your role is as the chief administrative officer of a large non-profit health relief organization. After reviewing the course concepts you will identify several issues that directly connect to the written assignment. You are in the role..
Long-term corporate bonds had an average return : Assume that long-term corporate bonds had an average return of 5.3 percent and a standard deviation of 9.3 percent for a 30-year period. What range of returns would you expect to see on these bonds 68 percent of the time?
After the repurchase how many shares will have outstanding : Luther is a successful logistical services firm that currently has $5 billion in cash. Luther has decided to use this cash to repurchase shares from its investors and has already announced the stock repurchase plan. Currently Luther is an all-equity ..
How much will you have in the account when you retire at age : Starting when you are 20 years old, you deposit $100 a year into an paying 5.50% interest compounded semi-annually. How much will you have in the account when you retire at the age of 65?

Reviews

Write a Review

 

Financial Management Questions & Answers

  Affects both the supply and demand for bonds

Which of the following affects both the supply and demand for bonds? If the gap on a bank's balance sheet is $10,000 and interest rates rise by 5%, then bank profits. A two-year discount bond with face value $1,000 and price $950 has a yield of

  Internal customer service throughout the session

Identify a medium to large organization that is large enough to have departments (such as Human Resources, Finance & Accounting, Marketing, etc.).  You will want to choose an organization for which you have some inside information as you are going to..

  High degree of leverage then a small change in sales results

If a firm has a high degree of leverage then a small change in sales results in

  Yield to maturity is less than its coupon rate

A bond’s current yield must always be either equal to its yield to maturity or between its yield to maturity and its coupon rate. If a bond sells at par, then its current yield will be less than its yield to maturity. If a bond sells for less than pa..

  What is affordable home purchase price using assumptions

Assume the following: Annual Salary = $65,000 Other monthly debt payments = $250 Estimated monthly property taxes & insurance = $500 Mortgage interest rate = 6.0% Mortgage term = 30 years Down payment = 10% what is the affordable home purchase price ..

  What is the implied rate of return on this stock

A stock will pay a dividend of $4 at the end of the year. It sells today for $100 and is expected to sell in one year for $105. What is the implied rate of return on this stock?

  Compute the recaptured depreciation-capital gain and loss

An asset was purchased three years ago for $100,000 and can be sold for $40,000 today. The asset has been depreciated using the MACRS 5-year recovery period and the firm pays 40% taxes on both ordinary income and capital gain. SHOWING WORK- Compute t..

  Accumulate fund for retirement by making deposits

A person aged 30 wishes to accumulate a fund for retirement by making deposits of $100 at the beginning of each month for 15 years followed by deposits of $200 at the beginning of each month for the next 15 years. Starting at age 65 withdrawals will ..

  Shares of stock through a dutch auction

LC Delivery has decided to sell 1,500 shares of stock through a Dutch auction. The bids received are as follows:300 shares at $36 a share, 500 shares at $35, 1,000 shares at $34, 1,200 shares at $33, and 1,800 shares at $32 a share. How much will LC ..

  Two-stage free cash flow to the firm valuation method

Explain how the Two-Stage Free Cash Flow to the Firm valuation method can be used to calculate firm value.

  Same expected return and the same standard deviation

Stock ABC and Stock XYZ have the same current price of $50, and they offer the same distribution of future returns (with the same expected return and the same standard deviation). There exists a call option on one share of Stock ABC and a call option..

  The remaining balance of his initial mortgage

Da Feng is looking to refinance his home because rates have gone down since he purchased the house 5 years ago. He started with a 30-year fixed-rate mortgage of $213,000 at an annual rate of 6.70%. He has to make monthly payments. He can now get a 25..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd