Question
NEK Corp has cash flows that are normally distributed. The expected cash flow in the coming year is $50 million and the standard deviation of
NEK Corp has cash flows that are normally distributed. The expected cash flow in the coming year is $50 million and the standard deviation of cash flows in the coming year is $15 million. The firm has debt payments due this coming year equal to $30 million. Is the probability that NEK can meet its debt payments greater than or less than 5 percent? Explain your logic.
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Parimutuel Applications In Finance New Markets For New Risks
Authors: Ken Baron, Jeffrey Lange
1st Edition
1403939500, 9781403939500
