The probability that the stock price will be greater than

Assignment Help Financial Management
Reference no: EM131996500

A stock price is currently 50. Its expected return and volatility are 12% and 30%, respectively. Assume that its year-end price follows a lognormal distribution (i.e., ln(ST /50) follows a normal distribution, where T = 1).

What is the probability that the stock price will be greater than 60 in 1 year?

Reference no: EM131996500

Questions Cloud

Confidence interval for the average amount of time : What is the 99% confidence interval for the average amount of time all web customers of her company will spend visiting the new website?
What should be the value of this stock at t : A Stock will pay dividends at time t = 1 of $1.30. It is expected to grow at 11% as far as we can see into the future.
What is the value of a six-month european call option : A stock price is currently $50. Over each of the next two three-month periods it is expected to go up by 6% or down by 5%.
What is the sampling distribution of the sample proportion : What is the sampling distribution of the sample proportion? Assume the population proportion is 98% defective free.
The probability that the stock price will be greater than : Assume that its year-end price follows a lognormal distribution (i.e., ln(ST /50) follows a normal distribution, where T = 1).
Find the present value of all future dividends : A stock will pay a dividend of 1.00 per share a year from now. Dividends are expected to double each year for the next nine years and then remain level forever.
Prepare reports in responsibility system for plant manager : The Dallas plant manager's office costs were $97,530 actual and $93,440 budget. Prepare the reports in a responsibility system for The plant manager-Dallas
List price and the selling price in the table : Find the best predicted list price of a home having a selling price of ?$450,000. Use a significance level of 0.05.
Percentages of people preference in car color : For the past year, national percentages of people's preference in car color are as follows:

Reviews

Write a Review

Financial Management Questions & Answers

  Calculate payments of accounts wages and taxes

Calculate Payments of accounts Wages, taxes, and other expenses Long-term financing (interest and dividends)

  Capital budgeting requirments and pay the dividend

Ring Technology has a capital budget of $875,000, it wants to maintain a target capital structure of 35% debt and 65% equity, and it also wants to pay a dividend of $575,000. If the company follows the residual dividend model, how much net income mus..

  Component cost of debt for use in the WACC calculation

what is the component cost of debt for use in the WACC calculation?

  Retirement annuity

You plan to retire in exactly 22 years. Your goal is to create a fund that will allow you to receive $6,000 at the end of each month for 25 years after retirement. You believe you will be able to earn 5% per year, compounded monthly during the 25-yea..

  Individual investors and institutional investors

What are some key differences between individual investors and institutional investors?

  Calculate the weighted average cost for a firm

Given the following info, calculate the weighted average cost for a firm:

  Financial institutions markets either direct

Ement to cover different tool to flow the Funds between the financial institutions and financial institutions markets either direct or indirect finance.

  Constant growth rate-equilibrium with the required return

Constant Growth Rate, g A stock is trading at $65 per share. The stock is expected to have a year-end dividend of $4 per share (D1 = $4), and it is expected to grow at some constant rate g throughout time. The stock's required rate of return is 12% (..

  Savings and loan offering an introductory rate

You receive a credit card application from Shady Bank Savings and Loan offering an introductory rate of 1.6% per year,

  Residual distribution policy

Petersen Company has a capital budget of $1.3 million. The company wants to maintain a target capital structure which is 55% debt and 45% equity. The company forecasts that its net income this year will be $600,000. If the company follows a residual ..

  Calculate the PB period-Discounted PB and IRR

The Postal Service has just awarded Steve an additional contract that will require Steve to purchase six new tractors. He competed aggressively for the contract and spent a total of $45,000 in costs to prepare and submit the bid. Steve has narrowed h..

  Debt ratio assuming firm uses only debt and common equity

Calculate Brauer's debt ratio assuming the firm uses only debt and common equity.

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