Given below are the likely returns in case of shares of VCC Ltd. and LCC Ltd. in the various economic conditions. Both the shares are presently quoted at 100 per share.
|
Economic Conditions |
Probability |
Returns of VCC Ltd. |
Returns of LCC Ltd. |
| High Growth
Low Growth Stagnation Recession |
0.3 0.4 0.2 0.1 |
100 110 120 140 |
150 130 90 60 |
Which of the two companies are risky investments?
One Comment