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5. Descriptive statistics for the closing stock prices of two companies for several trading periods are shown below. Microsoft, Inc. Tesla Motors, Inc. Mean 4.04 Kurtosis -1.1 Mean 16.41 Kurtosis 9.1 Standard Error 0.11 Skewness 0.04 Standard Error 0.22 Skewness -2.85 Median 4.07 Range 3.98 Median 16.83 Range 12.57 Mode 3.59 Minimum 2 Mode 16.59 Minimum 6.29 Standard Deviation 1.13 Maximum 5.98 Standard Deviation 2.34 Maximum 18.86 416.05 1919.63 Sample Variance 1.28 Sum Count 103 Sample Variance 5.48 Sum Count 117 a. Which stock is more risky? Why? b. Which company's stock price has a more dispersed distribution? Explain. Show your com- plete work and support your answer.

5. Descriptive statistics for the closing stock prices of two companies for several trading periods are shown below. Microsoft, Inc. Tesla Motors, Inc. Mean 4.04 Kurtosis -1.1 Mean 16.41 Kurtosis 9.1 Standard Error 0.11 Skewness 0.04 Standard Error 0.22 Skewness -2.85 Median 4.07 Range 3.98 Median 16.83 Range 12.57 Mode 3.59 Minimum 2 Mode 16.59 Minimum 6.29 Standard Deviation 1.13 Maximum 5.98 Standard Deviation 2.34 Maximum 18.86 416.05 1919.63 Sample Variance 1.28 Sum Count 103 Sample Variance 5.48 Sum Count 117 a. Which stock is more risky? Why? b. Which company's stock price has a more dispersed distribution? Explain. Show your com- plete work and support your answer.

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
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### Descriptive Statistics for Closing Stock Prices The table below presents descriptive statistics for the closing stock prices of two companies over several trading periods: Microsoft, Inc. and Tesla Motors, Inc. | Statistic | **Microsoft, Inc.** | **Tesla Motors, Inc.** | |---------------------|--------------------|-----------------------| | **Mean** | 4.04 | 16.41 | | **Standard Error** | 0.11 | 0.22 | | **Median** | 4.07 | 16.83 | | **Mode** | 3.59 | 16.59 | | **Standard Deviation** | 1.13 | 2.34 | | **Sample Variance** | 1.28 | 5.48 | | **Kurtosis** | 0.04 | 9.1 | | **Skewness** | -1.1 | -2.85 | | **Range** | 3.98 | 12.57 | | **Minimum** | 2.13 | 6.29 | | **Maximum** | 5.98 | 18.86 | | **Sum** | 416.05 | 1919.63 | | **Count** | 103 | 117 | #### Discussion Questions: 1. **Which stock is more risky? Why?** 2. **Which company's stock price has a more dispersed distribution? Explain. Show your complete work and support your answer.** 3. **Compare the Skewness of the two and explain what is indicated.** ### Detailed Explanation: **1. Assessing Risk:** To determine which stock is more risky, we look at the standard deviation of the stock prices. Standard deviation indicates the amount of variation or dispersion from the average. - **Microsoft, Inc.** Standard Deviation: 1.13 - **Tesla Motors, Inc.** Standard Deviation: 2.34 Since Tesla Motors, Inc. has a higher standard deviation, it implies greater volatility and hence, higher risk compared to Microsoft, Inc. **2. Dispersion of Stock Prices:** Dispersion can be measured using the sample variance or standard deviation. - **Microsoft, Inc.:** Sample
Transcribed Image Text:### Descriptive Statistics for Closing Stock Prices The table below presents descriptive statistics for the closing stock prices of two companies over several trading periods: Microsoft, Inc. and Tesla Motors, Inc. | Statistic | **Microsoft, Inc.** | **Tesla Motors, Inc.** | |---------------------|--------------------|-----------------------| | **Mean** | 4.04 | 16.41 | | **Standard Error** | 0.11 | 0.22 | | **Median** | 4.07 | 16.83 | | **Mode** | 3.59 | 16.59 | | **Standard Deviation** | 1.13 | 2.34 | | **Sample Variance** | 1.28 | 5.48 | | **Kurtosis** | 0.04 | 9.1 | | **Skewness** | -1.1 | -2.85 | | **Range** | 3.98 | 12.57 | | **Minimum** | 2.13 | 6.29 | | **Maximum** | 5.98 | 18.86 | | **Sum** | 416.05 | 1919.63 | | **Count** | 103 | 117 | #### Discussion Questions: 1. **Which stock is more risky? Why?** 2. **Which company's stock price has a more dispersed distribution? Explain. Show your complete work and support your answer.** 3. **Compare the Skewness of the two and explain what is indicated.** ### Detailed Explanation: **1. Assessing Risk:** To determine which stock is more risky, we look at the standard deviation of the stock prices. Standard deviation indicates the amount of variation or dispersion from the average. - **Microsoft, Inc.** Standard Deviation: 1.13 - **Tesla Motors, Inc.** Standard Deviation: 2.34 Since Tesla Motors, Inc. has a higher standard deviation, it implies greater volatility and hence, higher risk compared to Microsoft, Inc. **2. Dispersion of Stock Prices:** Dispersion can be measured using the sample variance or standard deviation. - **Microsoft, Inc.:** Sample
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