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Question 7 (Bonus 1pt: Variance estimate) Let n- for i = 1,. ..,n be independent sample of return r, a random variable with mean 77

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Question 7 (Bonus 1pt: Variance estimate) Let n- for i = 1,. ..,n be independent sample of return r, a random variable with mean 77 and variance a2. Dene the estimates Show that 1E [52] = 02, i.e. 52 is an unbiased estimate of 02. Note that you should calculate E [ 1 21:1 (Ti 7%) 2] With 7% = % 221:1 n- being random. nl

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