statistics Question 2
posted by Steven .
Suppose a person buys 100 shares of stock at in a company at the cost price of $10 per share. He plans to sell at the end of the next month at whatever is the price at that time. The projected price of the stock at the end of next month and the corresponding probability of reaching that price are given below:
Projected Price Probability
$8.00 0.10
$9.00 0.20
$10.00 0.25
$11.00 0.30
$12.00 0.15
Suppose X denotes the profit he will make from the sale of the 100 shares.
• What is the expected value of X?
• What is the variance of X?

statistics Question 2 
Kuai
expect value x
a. 8(0.1) + 9(.2) + 10(.25) + 11(.30) + 12 (.15) = 10.2
b. 8^2(0.1) + 9^2(.2) + 10^2(.25) + 11^2(.30) + 12^2(.15) = 180.5
Respond to this Question
Similar Questions

Algebra
Joshua originalle bought two hundred shares of stock three years ago. The company has since had a 2 for 1 stock split. Joshua's entire investment in stock has increased in value by 20%. He originally paid $8,600 for the stock. What … 
Finance questions
1) growth rates The stock price of the company is $76 investors require a 14% rate of return on similar stocks If the company plans to pay a dividend of $5.00 next year the expected growth rate of the company's stock price is ______ … 
Finance. PLEASE HELP ME
1) growth rates The stock price of the company is $76 investors require a 14% rate of return on similar stocks If the company plans to pay a dividend of $5.00 next year the expected growth rate of the company's stock price is ______ … 
Finance
2) The company wishes to raise $100 million by issuing stock. The current market price is $15 per share, however, if issued the price will drop to $12.50 per share. How many shares will need to be issued if under writing is 5% per … 
Accounting
Effect of Stock Split Gino's Restaurant Corporation wholesales ovens and ranges to restaurants throughout the Midwest. Gino's Restaurant Corporation, which had 100,000 shares of common stock outstanding, declared a 5for1 stock split … 
Statistics
Suppose a person buys 100 shares of stock at in a company at the cost price of $10 per share. He plans to sell at the end of the next month at whatever is the price at that time. The projected price of the stock at the end of next … 
Finance
An investor buys 100 shares of a $40 stock that pays an annual cash dividend of $2 a share (a 5 percent dividend yield) and signs up for the dividend reinvestment plan. A. If neither the dividend nor the price changes, how many shares … 
Accounting
When Resisto Systems, Inc., was formed, the company was authorized to issue 5,000 shares of $100 par value, 8 percent cumulative preferred stock, and 100,000 shares of $2 stated value common stock. Half of the preferred stock was issued … 
Acounting
How can I make journal entry for a corporation called H who is authorized to issue 100000 shares of $ 20 par common stock & 5000 shares of $ 100 par, 8 preferred stock. The following transactions affecting shareholders equity were … 
Algebra
Norman and Suzanne own 42 shares of a fast food restaurant stock and 66 shares of a toy company stock. At the close of the markets on a particular day in 2004, their stock portfolio consisting of these two stocks was worth $1944.00. …