Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Normal probability distribution Assuming that the rates of return associated with a given asset investment are normally distributed, that the expected return, r, is 15.8%;

image text in transcribed
Normal probability distribution Assuming that the rates of return associated with a given asset investment are normally distributed, that the expected return, r, is 15.8%; and that the coefficient of variation, CV, is 0.26 answer the following questions: a. Find the standard deviation of returns, o b. Calculate the range of expected return outcomes associated with the following probabilities of occurrence: (1) 68%, (2)95%, (3) 99% a. The standard deviation of returns, or, is % (Round to three decimal places.) b. (1) The lowest possible expected return associated with the 68% probability of occurrence is %. (Round to two decimal places.) The highest possible expected return associated with the 68% probability of occurrence is %. (Round to two decimal places) (2) The lowest possible expected return associated with the 95% probability of occurrence is 1% (Round to two decimal places) The highest possible expected return associated with the 95% probability of occurrence is % (Round to two decimal places) (3) The lowest possible expected return associated with the 99% probability of occurrence is % (Round to two decimal places.) The highest possible expected return associated with the 99% probability of occurrence is % (Round to two decimal places.) Enter your answer in each of the answer boxes

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Finance questions