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a) E(X+10) and SD(X+10) A broker has calculated the expected values of two different financial instruments X and Y. Suppose that E(X) = $110,
a) E(X+10) and SD(X+10) A broker has calculated the expected values of two different financial instruments X and Y. Suppose that E(X) = $110, E(Y) = $101, SD(X) = $10 and SD(Y) = $9. Find each of the following. b) E(5Y) and SD(5Y) c) E(X + Y) and SD(X + Y) d) What assumption must you make in part c? a) Find E(X + 10) and SD(X+ 10). E(X+10) = (Simplify your answer. Do not include the $ symbol in your answer.) SD(X+10) = (Simplify your answer. Do not include the $ symbol in your answer.) b) Find E(5Y) and SD(5Y). E(5Y) = (Simplify your answer. Do not include the $ symbol in your answer.) SD(5Y) = (Simplify your answer. Do not include the $ symbol in your answer.) c) Find E(X + Y) and SD(X + Y). E(X + Y) = (Simplify your answer. Do not include the $ symbol in your answer.) SD(X + Y)= (Round to two decimal places as needed. Do not include the $ symbol in your answer.) d) What assumption must you make in part c? Choose the correct answer below. A. To calculate the standard deviation, X and Y must be independent. B. To calculate the expected value, X and Y must be independent. C. To calculate the expected value and standard deviation, X and Y must be independent. OD. No assumptions are necessary to solve part c.
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