12.18 Returns on common stocks. Example 5 informs us that financial theory uses the mean and standard deviation to describe the returns on investments. Figure 11.13 (page 260) is a histogram of the returns of all New York Stock Exchange common stocks in one year. Are the mean and standard deviation suitable as a brief description of this distribution? Why?

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12.18 Returns on common stocks. Example 5 informs us that financial theory uses the
mean and standard deviation to describe the returns on investments. Figure 11.13 (page 260)
is a histogram of the returns of all New York Stock Exchange common stocks in one year.
Are the mean and standard deviation suitable as a brief description of this distribution?
Why?
Transcribed Image Text:12.18 Returns on common stocks. Example 5 informs us that financial theory uses the mean and standard deviation to describe the returns on investments. Figure 11.13 (page 260) is a histogram of the returns of all New York Stock Exchange common stocks in one year. Are the mean and standard deviation suitable as a brief description of this distribution? Why?
14
12
10
8
6.
4
2
22
25
28
31
34
37
40
Age in years
Moore/Notz, Statistics: Concepts and Controversies, 10e, © 2020 W. H.
Freeman and Company
Number of MVPS
Transcribed Image Text:14 12 10 8 6. 4 2 22 25 28 31 34 37 40 Age in years Moore/Notz, Statistics: Concepts and Controversies, 10e, © 2020 W. H. Freeman and Company Number of MVPS
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