Consider the following data:StockMNAverage return26%16%Risk (Std. Dev.)20%10%If the return on stocks M and N are perfectly negatively correlated, what is the range of risk (std dev) associated with all possibleportfolio combinations?A. Range of the risk: between 0= risk s10 %OB. Range of the risk: between 0 < risk 10%OC. Range of the risk: between 5% and 10%.OD. Range of the risk (std. dev): between 15% to 20%OE. None of the above

Answered: Image /qna-images/answer/cc49a38c-f116-4fe7-8fc4-4cc919060b32.jpg

Answered: Consider the following data: Stock M N…

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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Tiffany is a manager who needs to fire the worst performing 3% of employees. At her organization, employee performance is a normally distributed variable. Tiffany should fire employees who have a performance score that correspond with a z-score less than or equal to _____
O If p(A) = 0.17, p(B) = 0.06 and p(A and B) = 0.0102, are A and B independent? %3D
If a manager adopted both project A and project B simultaneously, the variance in returns associated with this joint project would be: Project Boom (25%) A B 18.75. 75. 30. 500. $30 -$15 Recession (75%) -$15 $20
The diversifiable risk of a portfolio:a. Is correlated with systematic risk.b. Can be made sufficiently small.c. Is zero in the real world.d. Is the risk that investors lose because of transaction costs.
Which investment has the highest expected return? Which is the safest investment and why? Which is the riskiest investment and why? A. x P(x) xP(x) 7000000 0.2 1400000 0 0.3 0 -1000000 0.5 -500000 Total 900000 b. x P(x) xP(x) 3000000 0.10 3000000 2000000 0.60 1200000 -1000000 0.30 -300000 Total 1200000 c. x P(x) xP(x) 3000000 0.40 1200000 0 0.50 0 -1000000 0.10 -100000 Total 1100000
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The probability distribution for X and Y is shown by the table. Find the marginal distribution function value of X = 1. G(1) = X 2 3 1 0.06 0.10 0.04 2 0.10 0.12 0.13 3 0.15 0.19 0.11 Y
Given the following investment returns from two stocks:Stock A: 5%,6%,7%,9%,23% (mean = 10% and standard deviation = 7.416%)Stock B: 50%,60%,70%,90%,230% (mean = 100% and standard deviation = 74.16%).Which stock has the greatest relative risk? Which stock should a risk seeking investor choose? Two correct answers 1. Stock A has the greatest relative risk. 2. Stock B has the greatest relative risk. 3. Both stocks have the same amount of relative risk. 4. A risk seeking investor should invest in Stock A. 5. A risk seeking investor should invest in Stock B. 6. A risk seeking investor should invest in either of the two stocks since they are equally attractive.
The price to earnings ratio (P/E) Is an Important tool in financial work. A random sample of 14 large U.S. banks (JP Morgan Chase, Bank of America, and others) gave the following P/E ratios.t 24 16 22 14 12 13 17 22 15 19 23 13 11 18 The sample mean is x = 17.1. Generally speaking, a low P/E ratio indicates a "value" or bargain stock. Suppose a recent copy of a magazine indicated that the P/E ratio of a certain stock index is H = 18. Let x be a random variable representing the P/E ratio of all large U.S. bank stocks. We assume that x has a normal distribution and o = 4.7. Do these data indicate that the P/E ratio of all U.S. bank stocks is less than 18? Use a = 0.01. (a) What is the level of significance? State the null and alternate hypotheses. Will you use a left-tailed, right-tailed, or two-tailed test? O Ho: H = 18; H1: H # 18; two-tailed O Ho: H = 18; H1: H 18; right-tailed %3D O Ho: H # 18; H1: H = 18; two-tailed (b) What sampling distribution will you use? Explain the rationale…
10 The observed insurance policy deviates from the predicted policy, on average, by _______ ($1,000) a 44.465 b 49.406 c 54.895 d 60.994
1. The data in Table 7–6 were collected in a clinical trial to evaluate a new compound designed to improve wound healing in trauma patients. The new compound was com- pared against a placebo. After treatment for 5 days with the new compound or placebo, the extent of wound healing was measured. Is there a difference in the extent of wound healing between the treatments? (Hint: Are treatment and the percent wound healing independent?) Run the appropriate test at a 5% level of significance. Use the data in Problem 1. Pool the data across the treatments into one sample of size n = 250. Use the pooled data to test whether the distribution of the percent wound healing is approximately normal. Specifically, use the following distribution 30%, 40%, 20%, and 10% and a = 0.05 to run the appropriate test. Percent Wound Healing Treatment 0-25% 26-50% 51-75% 76-100% New compound (n=125) 15 37 32 41 Placebo (n=125) 36 45 34 10
Q1. A psychologist conducted a study on the relationship between introversion and shyness. The values are results for scales of introversion and shyness. High positive scores on each scale indicate high introversion or shyness; and high negative scores indicate low introversion or shyness. Data collected from 10 people as follows: Introversion 4 -7 -1 0 6 7 -4 -9 -5 8 Shyness 11 -7 -1 -3 0 7 -1 -8 -1 5 a) Compute the correlation coefficient relating introversion and shyness scores. b) Find the regression equation which predicts introversion from shyness. c) What introversion score would you predict from a shyness score of 7?

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