Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Assume the returns from holding an asset are normally distributed. Also assume the average annual return for holding the asset a period of time was
Assume the returns from holding an asset are normally distributed. Also assume the average annual return for holding the asset a period of time was 16.3 percent and the standard deviation of this asset for the period was 33.5 percent. Use the NORMDIST function in Excel to answer the following questions. | |
a. | What is the approximate probability that your money will double in value in a single year? (Do not round intermediate calculations and enter your answer as a percent rounded to 3 decimal places, e.g., 32.161.) |
b. | What is the approximate probability that your money will triple in value in a single year? (Do not round intermediate calculations and enter your answer as a percent rounded to 8 decimal places, e.g., 32.16161616.) |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started