ABC Ltd is a publicly listed company on the Australian Securities Exchange. ABCs annual stock returns are assumed to be normally distributed with a mean of 0.08 and a standard deviation of 0.04.

a.What is the probability of ABCs stock return exceeding 12%? Show all working.

b.What is the probability of ABCs stock return being less than -8%? Show all working. c.What is the probability of ABCs stock return falling between 9% and 13%? Show all working. d.Discuss the disadvantages of assuming that stock returns are normally distributed. e.Discuss the difficulties associated with utilising ex-ante measures of risk.

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