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Use the following data to answer the question below. Suppose over the past several decades the average annual return on the S&P 500 equals 10%.
Use the following data to answer the question below. Suppose over the past several decades the average annual return on the S&P 500 equals 10%. Suppose the standard deviation of these annual returns equals 20%. Assuming that S&P 500 returns follow a normal distribution, whats the probability that next year the S&P 500 return will be above 30% or below 10%? A) About 95% B) About 68% C) About 32% D) About 5% E) Less than 1%
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