Question
A. The client needs to decide if he should invest on the stocks of a food delivery company, called Pippo. The annual profit per 100
A. The client needs to decide if he should invest on the stocks of a food delivery company, called Pippo. The annual profit per 100 invested for Pippo has been estimated that will follow the probability distribution in the following table:
Pippo | |
Profit per 100 |
Probabilities |
160 | 0.10 |
120 | 0.25 |
700 | 0.20 |
200 | 0.15 |
-300 | 0.20 |
-800 | 0.10 |
A second stock, of the rival food delivery company called Paperino has the following estimated profit per 100 invested and associated probabilities:
Paperino | |
Profit | Probabilities |
85 | 0.10 |
60 | 0.25 |
45 | 0.20 |
25 | 0.15 |
15 | 0.20 |
10 | 0.10 |
The company considers very good investments the ones characterized by a rate of return above the 18%. What percentage of the stocks included in the portfolio will have a rate of return above the 18%? [5 marks]
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