1. The life expectancy of Timely brand watches is normally distributed with a mean of five years and a standard deviation of 0.8year. (a) Find the probability that a randomly selected watch will be in working condition for less than Six years? (3 points) (b) 98% of the watches will have a life expectancy of greater than how many years? (2 Points) 2. The average score of all pro golfers for a particular course has a mean of 70 and a standard deviation of 3.0. Suppose 36 golfers played the course today. Find the probability that the average score of the 36 golfers exceeded 71 (3 points). 3. You are trying to set up a portfolio that consists of a corporate bond fund and a common stock fund. The following information about the annual return (per $1,000) of each of these investments under different economic conditions is available along with the probability that each of these economic conditions will occur. (12 Points) Probability State of the Economy Corporate Bonds Common Stocks 10 Recession $40 $120 15 Stagnation 60 35 35 Slow growth 90 110 .30 Moderate growth 100 140 10 High growth 110 210 Compute the (a) Expected return for corporate Bonds. (b) Standard deviation for corporate Bonds. (c) Expected return for common stocks (d) Standard deviation for common stocks (@) Would you invest in corporate bonds or common stocks? Why