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A company is considering investing in a project that has an expected return of 10% per year with a standard deviation of 15%. The company's
A company is considering investing in a project that has an expected return of 10% per year with a standard deviation of 15%. The company's risk manager wants to assess the risk associated with this investment and determine the level of risk that is acceptable. If the risk manager wants to limit the probability of losing more than 5% of the investment in any given year to no more than 2.5%, what is the maximum investment amount that the company should make?
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Management and Cost Accounting
Authors: Colin Drury
10th edition
1473748873, 9781473748910 , 1473748917, 978-1473748873
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