Suppose that the random change in value of a financial asset is X over the first day and Y over the second. Suppose also that Var(X) =18, and Var(Y) =26 In this case, the total change in the value over these two days is given by X +Y. Do you have enough information to compute Var(X + Y)? If so, compute this value. If not, explain what additional information you need to do so.

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Suppose that the random change in value of a financial asset is X over the first day and Y over the second.
Suppose also that Var(X) =18 and Var(Y) = 26 In this case, the total change in the value over these two days
is given by X +Y. Do you have enough information to compute Var(X +Y)? If so, compute this value. If not,
explain what additional information you need to do so.
Transcribed Image Text:Suppose that the random change in value of a financial asset is X over the first day and Y over the second. Suppose also that Var(X) =18 and Var(Y) = 26 In this case, the total change in the value over these two days is given by X +Y. Do you have enough information to compute Var(X +Y)? If so, compute this value. If not, explain what additional information you need to do so.
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