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Question 2-31I

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Essentials Of Investments
Found in: Page 52
Essentials Of Investments

Essentials Of Investments

Book edition 9th
Author(s) Zvi Bodie, Alex Kane, Alan Marcus, Alan J. Marcus
Pages 748 pages
ISBN 9780078034695

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Short Answer

Examine the stocks listed in Figure 2.8. For how many of these stocks is the 52-week high price at least 50% greater than the 52-week low price? What do you conclude about the volatility of prices on individual stocks?

11 stocks;

Stocks are highly volatile

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Step by Step Solution

Definition

A stock is a share of ownership of a fraction in a corporation, proportionate to the number of shares owned.

Explanation

On the basis of examination of Figure 2.8, it is found that there are 11 stocks which have a 52 weeks high at least 50% greater than the 52 week low price.

Conclusion: Individual stocks are highly volatile.

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