A bank estimates that its profit next year is normally distributed with a mean of 0.9% of assets and the standard deviation of 3% of assets. How much equity (as a percentage of assets) does the company need to be 99.9% sure that it will have positive equity at the end of the year? Ignore taxes. a. 2.19 b. 9.27 x c. 3.09 d. 8.37
A bank estimates that its profit next year is normally distributed with a mean of 0.9% of assets and the standard deviation of 3% of assets. How much equity (as a percentage of assets) does the company need to be 99.9% sure that it will have positive equity at the end of the year? Ignore taxes. a. 2.19 b. 9.27 x c. 3.09 d. 8.37
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Vijay
![A bank estimates that its profit next year is normally distributed with a mean of 0.9% of assets and the standard deviation
of 3% of assets. How much equity (as a percentage of assets) does the company need to be 99.9% sure that it will have
positive equity at the end of the year? Ignore taxes.
a. 2.19
b. 9.27 x
c. 3.09
d. 8.37](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7b387450-bcd7-41fa-8f38-ea5aefafdfe3%2Fbee074fa-1ae0-49e9-9fc5-33babea1874c%2Fzuhkr2fj_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A bank estimates that its profit next year is normally distributed with a mean of 0.9% of assets and the standard deviation
of 3% of assets. How much equity (as a percentage of assets) does the company need to be 99.9% sure that it will have
positive equity at the end of the year? Ignore taxes.
a. 2.19
b. 9.27 x
c. 3.09
d. 8.37
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