What is the expected rate of return from this investment

Assignment Help Business Management

Reference no: EM131374948

Refer to Review given Problem. Power Tech feels comfortable about the probability estimate regarding the change in North American demand.

However, they would like to examine the probability estimate for Asian demand more carefully. Perform sensitivity' analysis on the probability that Asian demand increases.

Try the following values, {0.1, 0.2, 0.3, 0.4, 0.5}, in which 0.3 is the base case value. Analyze the result and give a revised recommendation as to Power Tech's possible partnership.

Problem:
An investment has possible rates of return of 7%, 10%, and 15% over five years. The probabilities of attaining these rates, estimated on the basis of the current economy, are 0.65, 0.25, and 0.1, respectively. If you have ¥10 000 to invest,

(a) What is the expected rate of return from this investment?

(b) What is the variance of the rate of return on this investment?

Reference no: EM131374948

Questions Cloud

What is verda doing during the night : Verda has visited a sleep clinic to help her identify her sleep troubles. Dr. Richter has diagnosed her with Somnambulism. What is Verda doing during the night

Should the alcohol drinking age be increased : Write two pages argumentive essay - Should the alcohol drinking age be increased or decreased? or should marijuana be legal?

List the company profiles that you reviewed : List the company profiles that you reviewed. What factors do you think contributed to the firm receiving the top honors in the current year?

Discuss about the post given below : Geno's Restaurant has a dress policy that requires female servers to wear a uniform provided by the restaurant, but male servers are simply told to wear black shirts and blank slacks. The uniforms that are provided to female servers consist of ver..

What is the expected rate of return from this investment : What is the expected rate of return from this investment?- What is the variance of the rate of return on this investment?

Have you ever seen the show the office : Have you ever seen the show "The Office"? Now, it's a funny show because it's sad, right? It's disaffected. And yet we can't help watching it. And do you know why we can't help watching it?

Write an essay about successful student : Write an essay about successful student and use 30 words from this list please

Describe a major theme of the movie : Describe a major theme of the movie you have selected using evidence from the movie itself as well as course resources and other scholarly sources to support your position.

Determine what bbb should do about the packaging line : The present worth of the benefit of having the line running is $150 000. Use decision tree analysis to determine what BBB should do about the packaging line.

User Account

All Pages