Phoenix Company Common Stock Is Currently Selling for $20 Per

Multiple Choice

Phoenix Company common stock is currently selling for $20 per share.Security analysts at Smith Blarney have assigned the following probability distribution to the price of (and rate of return on) Phoenix stock one year from now:

Assuming that Phoenix is not expected to pay any dividends during the coming year, determine the expected rate of return on Phoenix Stock.

A) 8%
B) 0%
C) 10%
D) 40%