QUESTION 3Ahmed is looking for a safe investment that provides stable returns with less risk. Assume he has two options for investment: Stock Alpha, of a company with strong financialperformance, that offers an average return of 14% with a standard deviation of 6%. The second option is an Exchange-Traded Fund (ETF) that averages a return of 10% witha standard deviation of 5%. Which option should Ahmed choose?O Stock Alpha since it is more risky than ETF.O ETF since it is more risky than Stock Alpha.O Stock Alpha since it is less risky than ETF.O ETF since it is less risky than Stock Alpha.QUESTION 4A manufacturer of new microprocessors claims that less than 1% of his products are defective. This value is an example of aO variable.O sample.O parameter.O statisticQUESTION 5Identify the outlier(s) for the given data values:110 125 97 117 101 103 123 167 101QUESTION 6Mariam scored 59.10 marks on a Final Exam of MTH-213. The mean score of the class was 69.39 with a standard deviation of 5. Calculate the z-score for the markssecured by Mariam. Round your answer to two decimal places.

It is given that Ahmed is looking for a safe investment that provides stable returns with less risk.…

Answered: QUESTION 3 Ahmed is looking for a safe…

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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I2 The market portfolio has an expected return of 10% and consists of 30% in stock and 70% in real estate, and the risk-free interest rate is 5%. Based on the single-factor CAPM model and the following information on stock and property returns: The standard deviation of stock performance: 0.2 The standard deviation of real estate performance: 0.1 The correlation between stock return and real estate return: 0.3 1. What is the expected return for the stock and real estate? ** Please show detailed calculation
A FiveThirtyEight.com article reports that “Horror movies get nowhere near as much draw at the box office as the big-time summer blockbusters or action/adventure movies ... but there’s a huge incentive for studios to continue pushing them out. The return-on-investment potential for horror movies is absurd.” To investigate how the return-on-investment compares between genres and how this relationship has changed over time, an introductory statistics student fit a model predicting the ratio of gross revenue of movies from genre and release year for 1,070 movies released between 2000 and 2018. Using the plots given below, determine if this regression model is appropriate for these data
Example 13: Information regarding two mutual funds and marks inder ara given below: Standard Deviation (Per cent) Return Fund (Per cent) Beta Franklin Temple ton 14 30 0.72 Standard Chart 32 70 1.33 Market Index 20 48 1.00 Assuming the risk-free return as 5 per cent. Calculate the differential return (Jensen Ratio) for the two funds.
An investor wants to invest $300,000 in a portfolio of three mutual funds. The annual fund returns are normally distributed with a mean of 2.00% and standard deviation of 0.30% for the short-term investment fund, a mean of 5.00% and standard deviation of 2.50% for the intermediate-term fund, and a mean of 6.25% and standard deviation of 5.50% for the long-term fund. An initial plan for the investment allocation is 45% in the short-term fund, 35% in the intermediate-term fund, and 20% in the long-term fund. a. Use Analysis ToolPak, with a seed of 1, to develop a Monte Carlo simulation with 100 trials to estimate the mean ending balance after the first year. Note: Round the final answer to two decimal places. Mean ending balance after the first year b. If the allocation is changed to 30% short-term, 55% intermediate-term, and 15% long-term, estimate the ending balance after the first year. Note: Round the final answer to two decimal places. Mean ending balance after the first year c.…
(a) Find the value at risk (VaR) for an investment of $100,000 at 5%. (That is, find out how low the value of this investment could be if the worst 5% of outcomes are ruled out.) The investment is expected to grow during the year by 8% with SD 20%. Assume a normal model for the change in value. (b) To reduce the VaR to $12,000, how much more expected growth would be necessary? Assume that the SD of the growth remains 20%.
13. A standard logistic regression models the effect of age (20-29, 30-39, 40-49, 50-59, 60- 69) on experience of back pain (modeling yes vs. no). If age is included as a continuous covariate (with values 1, 2, 3, etc., as scores) and the regression parameter associated with age is estimated to be 0.21 with standard error of 0.08, what are the odds of backpain for a 35-year-old (e.g., in the 30-39 range) relative to the odds for a 25-year-old? Enter your answer to two numbers after the decimal place.
I need help figuring out how to determine the percentage of increase. For each of the following models, state what the expected value of Y is when X = 50. Also, state how the predicted value of Y changes when X increases by 5 units (i.e., a 10% increase). 1. Y = 73 + 10X X=50, y=73+10*50 = 573 Y = 573 Change = 50 units 2. lnY = 4.9 + 0.025X x = 50, y = exp(4.9 + 0.025*50) = 468.7 =exp(0.025*5)=1.13 units. Y = 468.7 Change = 1.13 units 3. Y = -632 + 328(lnX) X = 50, y=-632 + 328*(in50) = 651.1 = 328*In(5) = 527.9 Y = 651.1 Change = 527.9 units 4. lnY = 2.7 + 0.94(lnX) x=50, y=exp(2.7 + 0.94*In50) = 588.3 = exp (0.94*In5) = 4.54 Y = 588.3 Change = 4.54 units
(a)Consider a flight with a seating capacity of 160 seats. This flight is always full and there is a chance to be overbooked. The actual no-show rate (NSR) of the flight is 3.5% and the estimated NSR is 6.3%. If this flight is oversold according to the estimated NSR, what is the number of excess/extra passengers that will show up and there will be no seats for them on the day of departure? (b)Consider a flight with a seating capacity of 160 seats. This flight is always full and there is a chance to be overbooked. The actual no-show rate (NSR) of the flight is 3.5% and the estimated NSR is 6.3%. If the one-way fare of this flight is $300. If this flight is oversold according to the estimated NSR, what is the additional revenue that this flight will generate due to overbooking?
Suppose that the value of an index of the stock market increases on average about 0.02% per day (calculated with continuous discounting) and a volatility (i.e., standard deviation) of 1% per day. Assuming that the returns are Normally distributed, what would be the 5% Daily Expected Shortfall (ES) expressed as a percent return? (Note: Enter your answer rounded to the nearest 2 decimal places. (For example, -1.2345% should be entered as -1.23%).
Suppose that the borrowing rate that your client faces is 9%. Assume that the equity market index has an expected return of 13% and standard deviation of 25%, that rf = 5%. Your fund manages a risky portfolio, with the following details: E(rp) = 11%, p = 15%. What is the largest percentage fee that a client currently lending (y 1)? (Negative values should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 1 decimal place.) y 1
The following information relate to the two: Projects A and B of Augustina's Co.Ltd. State of the Economy Probability Returns of A (%) Returns of B (%) Boom Normal Recession 0.4 0.3 0.3 20 15 10 9 12 18 A. Calculate the expected return and standard deviation of Projects A and B B. If project A and B are combined in the ratio 6:4, what is the expected return and standard deviation of the portfolio
Example 10: P and Q two securities, with expected returns of 15% and 24% respectively, and standard deviation of 35% and 52% respectively. Calculate the standard deviation of a portfolio weighted equally between the two securities if their correlation is -0.9.

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