State of Economy Bust Boom State of Economy Probability of State of Economy 0.50 0.50 Bust Boom Security Returns if State Occurs Calculate the expected returns for Roll and Ross by filling in the following table: Note: A negative value should be indicated by a minus sign. Do not round intermediate calculations. Calculate the product using the decimal value of the probability and the percentage value of the return. Input all your answers as a percent rounded to 2 decimal places. Probability of State of Economy 0.50 0.50 Roll -188 19 Return if State Occurs -18 Ross 12% 5 Answer is complete but not entirely correct. Roll % 19 % E(R)= Product % 78.00 10.00 % 0.50 % Return if State Occurs 12 5 Ross % % E(R)- Product 12.00 % 5.00 % % 8.50

State of Economy Bust Boom State of Economy Probability of State of Economy 0.50 0.50 Bust Boom Security Returns if State Occurs Calculate the expected returns for Roll and Ross by filling in the following table: Note: A negative value should be indicated by a minus sign. Do not round intermediate calculations. Calculate the product using the decimal value of the probability and the percentage value of the return. Input all your answers as a percent rounded to 2 decimal places. Probability of State of Economy 0.50 0.50 Roll -188 19 Return if State Occurs -18 Ross 12% 5 Answer is complete but not entirely correct. Roll % 19 % E(R)= Product % 78.00 10.00 % 0.50 % Return if State Occurs 12 5 Ross % % E(R)- Product 12.00 % 5.00 % % 8.50

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter15: Decision Analysis

Section: Chapter Questions

Problem 13P: The following profit payoff table was presented in Problem 1: The probabilities for the states of...

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