Question
In: Finance
Suppose the returns on an asset are normally distributed. The historical average annual return for the...
Suppose the returns on an asset are normally distributed. The
historical average annual return for the asset was 6.7 percent and
the standard deviation was 12.6 percent.
What range of returns would you expect to see 95 percent of the
time? (Enter your answers for the range from lowest to
highest. A negative answer should be indicated by a minus
sign. Do not round intermediate calculations.
Enter your answers as a percent rounded to 2 decimal places, e.g.,
32.16.)
95% level % to %
What range would you expect to see 99 percent of the time?
(Enter your answers for the range from lowest to highest. A
negative answer should be indicated by a minus sign.
Do not round intermediate calculations. Enter your answers
as a percent rounded to 2 decimal places, e.g.,
32.16.)
99% level % to %
Solutions
jeff jeffy answered 1 year agoRelated Solutions
Suppose the returns on an asset are normally distributed. The historical average annual return for the...
Suppose the returns on an asset are normally distributed. The
historical average annual return for the asset was 7.3 percent and
the standard deviation was 8.4 percent. What is the probability
that your return on this asset will be less than –4.5 percent in a
given year? Use the NORMDIST function in Excel® to answer this
question. (Do not round intermediate calculations. Enter your
answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Probability 8.0 % What range...
Suppose the returns on an asset are normally distributed. The historical average annual return for the...
Suppose the returns on an asset are normally distributed. The
historical average annual return for the asset was 5.9 percent and
the standard deviation was 10.5 percent. a. What is the probability
that your return on this asset will be less than –7.3 percent in a
given year? Use the NORMDIST function in Excel® to answer this
question. (Do not round intermediate calculations and enter your
answer as a percent rounded to 2 decimal places, e.g., 32.16.) b.
What range...
Assume that the returns from an asset are normally distributed. The average annual return for this...
Assume that the returns from an asset are normally distributed.
The average annual return for this asset over a specific period was
14.7 percent and the standard deviation of those returns in this
period was 43.59 percent.
a. What is the approximate probability that your money will
double in value in a single year? (Do not round intermediate
calculations and enter your answer as a percent rounded to 2
decimal places, e.g., 32.16.)
b. What about triple in value? (Do...
Assume that the returns from an asset are normally distributed. The average annual return for this...
Assume that the returns from an asset are normally distributed.
The average annual return for this asset over a specific period was
17.2 percent and the standard deviation of those returns in this
period was 43.53 percent.
a.
What is the approximate probability that your money will double
in value in a single year? (Do not round intermediate
calculations and enter your answer as a percent rounded to 2
decimal places, e.g., 32.16.)
b.
What about triple in value? (Do...
Assume that annual returns on large-company stocks are normally distributed with an average historical return of...
Assume that annual returns on large-company stocks are normally
distributed with an average historical return of 12.3% and a
standard deviation of 20.0%. What is the probability that annual
return on large-company stocks is greater than 5% and Less than
30%?
Assume the returns from holding an asset are normally distributed. Also assume the average annual return...
Assume the returns from holding an asset are normally
distributed. Also assume the average annual return for holding the
asset a period of time was 16.3 percent and the standard deviation
of this asset for the period was 33.5 percent.
What is the approximate probability that your money will double
in value in a single year? (Do not round intermediate
calculations and enter your answer as a percent rounded to 3
decimal places, e.g., 32.161.)
What is the approximate probability...
Suppose the returns on long-term corporate bonds are normally distributed. The average annual return for long-term...
Suppose the returns on long-term corporate bonds are normally
distributed. The average annual return for long-term corporate
bonds from 1926 to 2007 was 6.7 percent and the standard deviation
of those bonds for that period was 9.4 percent.
(a)
Based on this historical record, what is the approximate
probability that your return on these bonds will be less than -3.6
percent in a given year? (Do not round intermediate
calculations.)
(Click to
select)14.21%12.98%13.66%14.34%27.32%
(b)
What range of returns would...
QUESTION 4: The returns for an asset are normally distributed. The mean return is 9.75% and...
QUESTION 4: The returns for an asset are normally distributed.
The mean return is 9.75% and the standard deviation is 3.25%. a.
What is the probability of earning a negative return? (3 points) b.
What is the probability of earning a return between 6.5% and
16.25%? (3 points) c What is the probability of earning a return
greater than 13%? (3 points)
Suppose that the returns on an investment are normally distributed with an expected return of 8%...
Suppose that the returns on an investment are normally
distributed with an expected return of 8% and standard deviation of
4%. What is the likelihood of making a negative return? (Hint: the
area under a curve for 1 std dev is 34.13%, 2 std dev is 47.73% and
3 std dev is 49.87%).
A. 47.73%
B. 34.13%
C. 15.87%
D. 2.27%
Suppose that the annual return, R on a share is normally distributed with an expected annual...
Suppose that the annual return, R on a share is normally
distributed with an expected annual return of 10% and an annual
standard deviation of 20%.
Find using the Table of the normal distribution provided, the
probability that the annual return on the share will:
(i) Be positive. [2]
(ii) Be less than -5%. [2]
(iii) Lie between 5% and 15%. [2]
(iv) Be within one standard deviation of zero. [2]
(v) Be within one standard deviation of its mean....
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