Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Suppose the average return on Asset A is 6.8 percent and the standard deviation is 8.8 percent and the average return and standard deviation on

image text in transcribed

Suppose the average return on Asset A is 6.8 percent and the standard deviation is 8.8 percent and the average return and standard deviation on assume that the returns are normally distributed Use the NORMDIST function in Excele to answer the Asset B are 4.0 percent and 3.4 percent, respectively. Further following questions. a. What is the probability that in any given year, the return on Asset A will be greater than 10 percent? Less than 0 percent? (Round your answers to 2 decimal places. (e.g- 32.16) Greater than 10 percent Less than 0 percent b. What is the probability that in any given year, the return on Asset B will be greater than 10 percent? Less than 0 percent? (Round your answers to 2 decimal places. (e.g., 32.16) Greater than 10 percent Less than 0 percent c-1 In 1979, the return on Asset A was -4.27 percent. How likely is it that such a low return will recur at some point in the future? (Round your answer to 2 decimal places. (e.-g., 32.16) Probability C 2 Asset B had a return of 9.80 percent in this same year. How likely is it that such a high return on T bils will recur at some point in the future?(Round your answer to 2 decimal places. (e.g- 32.16) Probability rev: 12 06 2012

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Students also viewed these Finance questions