1. For any portfolio of securities where returns are normally distributed, what is the probability that the return in any given year will be either greater than 2 standard deviations above the mean or less than 2 standard deviations below the mean? Multiple Choice

4.56%

95.44%

47.72%

2.28%

2. The research of Jeremy Siegel showed that stocks have returned an average real rate of return of 6.8% from 1802 up to 2005. Assuming rates remain the same, you had a relative who invested $1,500 in the US stock market in 1802 and left it for the next 220 years. How much real value would the account now contain?

Multiple Choice

• $3,567,441,258

• $5,678,695,124

• $2,895,788,582

• $1,734,681,185