Question
Suppose you are a lazy account manager, managing a large portfolio and have invested your clients money in 90 independent companies, so that the expected
Suppose you are a lazy account manager, managing a large portfolio and have invested your clients money in 90 independent companies, so that the expected return on each individual investment is $15 with a variance of $100. Let Y be the normal random variable approximating the net return of your entire portfolio and let X be the average of the 90 returns.
(a) X is approximately a normal random variable with what mean and variance?
(b) What are the mean and variance of Y?
I know the mean is $1350 and the variance is 9000, but need help getting this answer)
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