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Find the mean of the 12 sampled ratios. =

Find the mean of the 12 sampled ratios. =

MATLAB: An Introduction with Applications
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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One measure of a company's health is its debt- to-equity ratio. If the ratio is too high, it is one indication of financial instability. For obvious reasons, banks often monitor the financial health of companies to which they have extended loans. Suppose that, in order to reduce risk, a large bank has decided to initiate a policy limiting the mean debt-to-equity ratio for its portfolio of commercial loans to 1.5. In order to estimate the mean debt-to-equity ratio of its loan portfolio, the bank randomly selects 12 of its commercial loan accounts. Audits of these twelve companies found the following 12 debt-to-equity ratios. 1.04 1.08 |1.13 1.18 1.23 |1.32 1.41 1.46 1.55 1.57 1.70 |1.77 Note: the sample standard deviation of these 12 ratios is s = 0.245 Find the mean of the 12 sampled ratios. = Do Not Round.
Transcribed Image Text:One measure of a company's health is its debt- to-equity ratio. If the ratio is too high, it is one indication of financial instability. For obvious reasons, banks often monitor the financial health of companies to which they have extended loans. Suppose that, in order to reduce risk, a large bank has decided to initiate a policy limiting the mean debt-to-equity ratio for its portfolio of commercial loans to 1.5. In order to estimate the mean debt-to-equity ratio of its loan portfolio, the bank randomly selects 12 of its commercial loan accounts. Audits of these twelve companies found the following 12 debt-to-equity ratios. 1.04 1.08 |1.13 1.18 1.23 |1.32 1.41 1.46 1.55 1.57 1.70 |1.77 Note: the sample standard deviation of these 12 ratios is s = 0.245 Find the mean of the 12 sampled ratios. = Do Not Round.
Expert Solution
Step 1

Mean is defined as the sum of observations divided by number of observations.

Number of observations n = 12

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