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In: Statistics and Probability

A private equity firm is evaluating two alternative investments. Although the returns are random, each investment's...

A private equity firm is evaluating two alternative investments. Although the returns are random, each investment's return
can be described using a normal distribution. The first investment has a mean return of $2000000 with a standard
deviation of $125000 . The second investment has a mean return of $ 2275000 with a standard deviation of $ 300000 .
Complete parts a through c below.

a. How likely is it that the first investment will return $1,800,000 or less?
The probability is .
(Round to four decimal places as needed.)
b. How likely is it that the second investment will return $1,800,000 or less?
The probability is .
(Round to four decimal places as needed.)
c. If the firm would like to limit the probability of a return being less than $1,650,000, which investment should it make?
The probability of a return being less than $1650000 is with the first investment and with
the second investment, so the firm should make the (1) investment.

(Round to four decimal places as needed

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