Donna is looking into investing a portion of her recent bonus into the stock market. While researching different companies, she discovers the following standard deviations of one year of daily stock closing prices. Masterful Pocketwatches: Perfect Plungers Plus: Standard deviation of stock prices = $9.83 Standard deviation of stock prices = $1.22 Based on the data and assuming these trends continue, which company would give Donna a stable long-term investment?
Donna is looking into investing a portion of her recent bonus into the stock market. While researching different companies, she discovers the following standard deviations of one year of daily stock closing prices. Masterful Pocketwatches: Perfect Plungers Plus: Standard deviation of stock prices = $9.83 Standard deviation of stock prices = $1.22 Based on the data and assuming these trends continue, which company would give Donna a stable long-term investment?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Masterful Pocketwatches; the larger standard deviation indicates that Masterful Pocketwatches has less variability in its closing prices than Perfect
Plungers Plus.
O
Perfect Plungers Plus; the smaller standard deviation indicates that Perfect Plungers Plus has a greater mean closing price than Masterful
Pocketwatches.
O
Masterful Pocketwatches; the larger standard deviation indicates that Masterful Pocketwatches has a greater mean closing price than Perfect
Plungers Plus.
O
Perfect Plungers Plus; the smaller standard deviation indicates that Perfect Plungers Plus has less variability in its closing prices than Masterful
Pocketwatches.

Transcribed Image Text:Donna is looking into investing a portion of her recent bonus into the stock market. While researching different companies, she discovers the
following standard deviations of one year of daily stock closing prices.
Masterful Pocketwatches:
Perfect Plungers Plus:
Based on the data and assuming these trends continue, which
Standard deviation of stock prices
= $9.83
Standard deviation of stock prices = $1.22
company would give Donna a stable long-term investment?
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