Q3/v4/pg 120

Question 3:
You are a stock analyst analyzing an NBFC company. The profitability and stock performance
depends upon the decisions taken by the MPC of RBI. Currently the stock is trading at 240. The
Probabilities of different decisions and its effect on market price are given below:
Decision           Probability Share Price
Rate Hike              0.20           280
Rate Cut                0.30             250
Rate unchanged 0.50               265
Calculate the expected return and S.d. of stock.

ANSWER:
Calculation of expected return:
Probability Price return(X) P.X
0.20 280 16.667% 3.33%
0.30 250 4.1667% 1.25%
0.50 265 10.4167% 5.21%
Expected return = ∑P.X = 9.79%

Doubt- here we calculate expected return and then multiply with probability , But if we calculate expected price and then calculate expected return give same answer .

So what is the logical difference between both of this , and why we dont this in option valuation