You are given the following probability distribution for the returns on Security A and Security B:Probability0.30.30.30.1Return on Security A37%7%20%-15%Return on Security B13%19%26%-22%Assume you invest $4,000 in Security A and $6,000 in Security B.What are the expected return and standard deviation of your portfolio?

ProbabilityReturn on Security AReturn on Security B0.337%13%0.37%19%0.320%26%0.1-15%-22%

Answered: You are given the following probability…

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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Which investment has the highest expected return? Which is the safest investment and why? Which is the riskiest investment and why? A. x P(x) xP(x) 7000000 0.2 1400000 0 0.3 0 -1000000 0.5 -500000 Total 900000 b. x P(x) xP(x) 3000000 0.10 3000000 2000000 0.60 1200000 -1000000 0.30 -300000 Total 1200000 c. x P(x) xP(x) 3000000 0.40 1200000 0 0.50 0 -1000000 0.10 -100000 Total 1100000
Let X = {Email, In Person, Instant Message, Text Message}; P(Email) = 0.06 P(In Person) = 0.55 P(Instant Message) = 0.24 P(Text Message) = 0.15 Is this model a probability distribution? A. Yes. B. No. C. Maybe.
Amount of claim (to nearest $20,000) Probability $0 0.70 $20,000 0.17 $40,000 0.06 $60,000 0.04 $80,000 0.02 $100,000 0.01 A. Calculate the expected value? B. How much should the company charge as an average premium so that it breaks even on its claim costs? C. How much should the company charge to make a profit of $50 per policy?
Suppose that you are offered the following "deal." You roll a six sided die. If you roll a 6, you win $7. If you roll a 4 or 5, you win $2. Otherwise, you pay $8.a. Complete the PDF Table. List the X values, where X is the profit, from smallest to largest. Round to 4 decimal places where appropriate. Probability Distribution Table X P(X) b. Find the expected profit. $ (Round to the nearest cent)c. Interpret the expected value. If you play many games you will likely lose on average very close to $2.17 per game. You will win this much if you play a game. This is the most likely amount of money you will win. d. Based on the expected value, should you play this game? No, since the expected value is negative, you would be very likely to come home with less money if you played many games. Yes, since the expected value is positive, you would be very likely to come home with more money if you played many games. Yes, since the expected value is 0, you would be…
Fire Insurance Amari's family is moving to California and would like to purchase fire insurance. The insurance company is offering them a plan with an annual premium of $450. If there is a fire that damages the home, the insurance company will pay $250,000. It is estimated that the probabilty of a fire in your area is 0.0008. What is the expected value of the policy? If an insurance company is able to sell 20,000 of these policies, how much can the company expect to earn?

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