Do bonds reduce the overall risk of an investment portfolio? Let x be a random variable representing annual percent return for Vanguard Total Stock Index (all stocks). Let y be a random variable representing annual return for Vanguard Balanced Index (60% stock and 40% bond). For the past several years, we have the following data. x: 33 0 24 32 29 23 31 −11 −21 −21 y: 20 −9 14 28 16 23 14 −7 −3 −3 (a) Compute Σx, Σx2, Σy, Σy2. Σx   Σx2   Σy   Σy2   (b) Use the results of part (a) to compute the sample mean, variance, and standard deviation for x and for y. (Round your answers to four decimal places.)   x y x     s2     s     (c) Compute a 75% Chebyshev interval around the mean for x values and also for y values. (Round your answers to two decimal places.)   x y Lower Limit     Upper Limit

Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
18th Edition
ISBN:9780079039897
Author:Carter
Publisher:Carter
Chapter4: Equations Of Linear Functions
Section4.5: Correlation And Causation
Problem 2CYU
Question

Do bonds reduce the overall risk of an investment portfolio? Let x be a random variable representing annual percent return for Vanguard Total Stock Index (all stocks). Let y be a random variable representing annual return for Vanguard Balanced Index (60% stock and 40% bond). For the past several years, we have the following data.

x:
33
0
24
32
29
23
31
−11
−21
−21
y:
20
−9
14
28
16
23
14
−7
−3
−3
(a) Compute Σx, Σx2, Σy, Σy2.
Σx   Σx2  
Σy   Σy2  

(b) Use the results of part (a) to compute the sample mean, variance, and standard deviation for x and for y. (Round your answers to four decimal places.)
  x y
x    
s2    
s    

(c) Compute a 75% Chebyshev interval around the mean for x values and also for y values. (Round your answers to two decimal places.)
  x y
Lower Limit    
Upper Limit    
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