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Unformatted text preview: What is the standard deviation of returns of stock A? 6. (1 points) What is max(5,10) ? What is min(10,5) ? 6. (5 points) Imagine you have won the state lottery! There are two alternative payouts. #1 $ 10 million one year from now #2 $ 20 million two years from now What alternative should you choose if the interest rate is: 6.1 0% 6.2 10% #1 NPV = 9,090,909.10 #2 NPV= 12,418,426.46 6.3 20% #1 NPV = 8,333,333.33 #2 NPV= 8,037,551.44 6.4 What discount rate makes the two alternatives equally attractive to you? 18.921%...
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 Spring '08
 KOCH

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