Q: Find the variance &Standard deveation of the portfolio
A: Excel Spreadsheet:
Q: The regression analysis is normally depicted as "y = Ax+ B." What does "A" indicate in the equation?…
A: FOR ANY QUERIES, PING ME HAPPY LEARNING
Q: When determining the riskiness of a stand-alone instrument (not included in a portfolio), which of…
A: The asset risk is classified into 2 terms One is stand alone risk in which we consider only the…
Q: The efficient frontier measures risk by using: Group of answer choices B. Correlation A. Risk-free…
A: Efficient frontier refers to the graphical representation of the set of optimal portfolios…
Q: What are some quantitative and some qualitative reasons for budget variances?
A: Budget variance is a measure used by entities, government organizations, corporations, or…
Q: The likelihood that an identified precision interval contains the true (but unknown) population…
A:
Q: What is the difference between covariance and correlation?
A: Co-variance: A co-variance is nothing but a descriptive measure of linear interaction intensity…
Q: Total risk is measured by and systematic risk is measured by Beta; standard deviation. Standard…
A: There are two types of risks systematic risk and unsystematic risk
Q: Illustrate the calculation of the standard deviation of returns?
A: Standard deviation refers to a measure of variation or dispersion of a set of values. We can…
Q: Show that the lower semi-standard deviation corrected expectation has properties (UT) und (UC)
A: Semi-deviation is an alternative to standard deviation for determining the degree of risk associated…
Q: Variance percentage is calculated by dividing the choose your answer... by the choose your answer...
A: Variation refers to the difference i.e. the difference between the current amounts with the budgeted…
Q: he variance of expected returns is equal to the square root of the expected returns. a. True b.…
A: Formula for variance:S2=∑(Xi-X̄) 2/n S2=VarianceXi=Value of one observationX̄=Mean value of all…
Q: How does the application of the standard deviation differ from the application of the coefficient of…
A: a. Standard Deviation: The average fluctuation of a variable around the mean is known as standard…
Q: In general, variance analysis is said to provide information about _________ and __________…
A:
Q: What is favorable variance? Give three examples?
A: Favorable Variance: Favorable variance is the variation in the actual and planned output which is…
Q: The regression line in a scatterplot is also known as a(n): O A. R-squared line. O B. high-low line.…
A: A regression line seems to be a line that is used to define how a set of data behaves. In other…
Q: differences between Weighted Average and FIFO methods
A: Weighted Average and FIFO methods are used to value inventory of business.
Q: What are some possible reasons for a material price variance?
A: The reason for material price variance has been shown below
Q: What is the relationship between management by exception and variance analysis?
A: Management by Exception: Management by exception is the process of finding the deviations in the…
Q: Explain Measures of Variance and Risk?
A: Variance tests normal or normal variability. Variability is volatility for investors, and volatility…
Q: )define market risk. b)define delta-hedged position and describe delta hedging.…
A: Market risk is the potential for financial loss that arises from adverse movements in market prices,…
Q: What are the characteristics of Probability Proportionate to Size (PPS) sampling?
A:
Q: hat is meant by measures of dispersion: standard deviation and variance. How can this be used when a…
A: Two important statical measures used in finance are standard deviation and variance of return of the…
Q: What is unfavorable variance? Give three examples?
A: Unfavorable Variance: Unfavorable variance is the variation in the actual and planned output which…
Q: Describe the two basic differences between the weighted average and the FIFO method.
A: Inventory: Inventory refers to the stock of goods purchased, utilized and maintained by the company…
Q: In variance analysis, Adverse and Favourable variances are subjective to the type of variance being…
A: In accounting we often prepare budgets. Budgets are cost plans and financial plans for the future.…
Q: Find the mean, variance, and standard deviation of the binomial distribution with the given values…
A: In Finance, mean is the sum of observations of returns divided by the number of such observations of…
Step by step
Solved in 3 steps with 2 images
- Expected Return, Variance, Std. Deviation and Cofficient of Variation:Magee Inc.'s manager believes that economic conditions during the next year will be strong, normal, or weak, and she thinks that the firm's returns will have the probability distribution shown below. What's the standard deviation of the estimated returns?Round your answer to two decimal places. For example, if your answer is $345.6671 round as 345.67 and if your answer is .05718 or 5.7182% round as 5.72. State of the Economy Probability of State Occurring Stock's Expected Return Boom 20% 22.20% Normal 50% 12.90% Recession 30% –11.40%Expected Return, Variance, Std. Deviation and Cofficient of Variation:Magee Inc.'s manager believes that economic conditions during the next year will be strong, normal, or weak, and she thinks that the firm's returns will have the probability distribution shown below. What's the standard deviation of the estimated returns?Round your answer to two decimal places. For example, if your answer is $345.6671 round as 345.67 and if your answer is .05718 or 5.7182% round as 5.72. State of the Economy Probability of State Occurring Stock's Expected Return Boom 30% 21.60% Normal 55% 13.50% Recession 15% –11.35% A. 11.04% B. 12.10% C. 9.47% D. 10.52% E. 9.99%Expected Return, Variance, Std. Deviation and Cofficient of Variation:Magee Inc.'s manager believes that economic conditions during the next year will be strong, normal, or weak, and she thinks that the firm's returns will have the probability distribution shown below. What's the standard deviation of the estimated returns?Round your answer to two decimal places. For example, if your answer is $345.6671 round as 345.67 and if your answer is .05718 or 5.7182% round as 5.72. State of the Economy Probability of State Occurring Stock's Expected Return Boom 20% 24.15% Normal 50% 13.50% Recession 30% –13.30% Group of answer choices 15.68% 16.39% 14.26% 13.54% 10.69%
- Consider the following variance-covariance matrix for Security A, Security B, and the Market: Variance-Covariance Matrix A B Market A 0.562500 0.091875 0.028125 0.091875 0.122500 0.021000 B Market 0.028125 0.021000 0.022500 For the coming year, the Market Risk Premium is 5.5 percent and the risk-free rate is 2.0 percent. Determine the required return for Security A using both the Capital Market Line and the Security Market Line (CAPM). What is the (absolute) difference between these two required returns? 12.375% O 16.875% 20.625% Ⓒ 7.700% 6.300%1. Consider two stocks A and B and a market index M with the following rates of return (%): Month 1 2 3 A 3.25 3 2 B 2.25 3.5 1.5 M 2 1.5 1 The matrix of variances and covariances is given below (%): Month A B M A 29.17 29.17 20.83 B 29.17 68.06 12.50 M 20.83 12.50 16.67 a. Construct the minimum risk portfolio of stocks A and B. What is the risk and the return on this portfolio? b. Knowing that Rf-0.5% compute the returns at equilibrium at decide whether the stocks are over or undervalued. c. Write the CML equation. Construct an efficient portfolio with a return of 2% d. Construct an equally weighted portfolio of A and B. Compute Treynor's, Sharpe's and Jensen's performance measures.1. Over the past 3 years an investment returned 0.18, -0.11, and 0.08. What is the variance of returns?
- Which one of the following is defined as the average compound return earned per year over a multiyear period? Multiple Choice A Geometric average return B Variance of returns C Standard deviation of returns D Arithmetic average return E. Normal distribution of returnsStock A has the following returns over the past periods. Calculate the downside risk measured by semi-variance? (answer with 4 decimal spaces) 0.0057 -0.0255 0.0621 -0.0879 -0.0983 0.0813 0.0356 -0.0015 -0.0307 0.0427 0.0297 0.0192Consider the information below, compute the expected return, variance, and standard deviation. Show the solution. Probability Return of Assets 25% .30 25% .050 25% .100 25% .280
- uppose the average return on Asset A is 7.1 percent and the standard deviation is 8.3 percent, and the average return and standard deviation on Asset B are 4.2 percent and 3.6 percent, respectively. Further assume that the returns are normally distributed. Use the NORMDIST function in Excel® to answer the following questions. a. What is the probability that in any given year, the return on Asset A will be greater than 12 percent? Less than 0 percent? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the probability that in any given year, the return on Asset B will be greater than 12 percent? Less than 0 percent? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) c-1. In a particular year, the return on Asset A was −4.38 percent. How likely is it that such a low return will recur at some point in the future? (Do not round…Consider an investment for which the expected returns are normally distributed with an expected return of 11% and an annual standard deviation (SD) of 12%. What is the probability that during a given year an investor would earn a return that is: a. greater than -1%?b. lower than -1%c. lower than -13%d. greater than 11%?e. greater than 23%?f. greater than 35%?Carson Inc.'s manager believes that economic conditions during the next year will be strong, normal, or weak, and she thinks that the firm's returns will have the probability distribution shown below. What's the standard deviation of the estimated returns? (Hint: Use the formula for the standard deviation of a population, not a sample.) Do not round your intermediate calculations. Economic Conditions Strong Normal Weak O a. 17.49% O b. 12.36% O c. 22.49% O d. 10.10% O e. 18.36% Prob. 30% 40% 30% Return 27.0% 13.0% -17.0%
