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Question
An investor is analyzing the risk of a possible investment by producing three different scenarios. Under a pessimistic scenario, the property would produce a BTIRRp of 8%; a most-likely scenario would produce a BTIRRp of 12%; and an optimistic scenario would produce a BTIRRp of 16%. The investor assigns the pessimistic scenario a 25% chance of occurring, the most-likely case a 60% chance of occurring, and the optimistic scenario a 15% chance of occurring. What is the standard deviation of the returns?
A) 0.062%
B) 1.248%
C) 2.498%
D) 2.904%
Answer
This answer is hidden. It contains 19 characters.
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