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A stock has a 25% probability of increasing by $10 and a 75% probability of decreaing by $5. What is the stocks expected increase or decrease?
Please help me!!!!

A stock has a 25 probability of increasing by 10 and a 75 probability of decreaing by 5 What is the stocks expected increase or decrease Please help me class=

Respuesta :

MathPhys

Step-by-step explanation:

The expected value is the sum of each probability times the value.

E = 0.25 (10) + 0.75 (-5)

E = -1.25

The stock is expected to decrease by $1.25.

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