1. A portfolio manager is expected to stay within 75 basis points of a benchmark index 90 percent of the time. The manager meets this objecti ve in six out of eight quarters. Calculate the probability that, given an assumed success rate of 90 percent, performance could be as bad as or worse than that delivered. Show all of your calculations.

2. Let X be a random variable with E(X)= 3 AND VAR (X)=2 FIND E.

. Show all of your calculations or explain.