EP STATISTICS-ACCESS (18 WEEK)
5th Edition
ISBN: 9780135960592
Author: Sullivan
Publisher: PEARSON CO
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Chapter 3.2, Problem 45AYU
(a)
To determine
The mean value of the yearly return and the level of risk in a portfolio with 10% foreign investments.
(b)
To determine
What percentage should be invested in foreign stocks to best minimize the risk?
(c)
To determine
The reason behind the initial decrement of the risk percentage as the percentage of foreign investments increases.
(d)
To determine
To calculate: The values between which there will be at least 75% of returns, according to Chebyshev’s Inequality.
To determine
To calculate: The two values between which there will be at least 88.9% of returns, according to Chebyshev’s Inequality.
To determine
To identify: The reaction of the investor after getting negative returns.
To determine
To explain: Why the investor should not be surprised after getting some negative returns?
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Show that L′(θ) = Cθ394(1 −2θ)604(395 −2000θ).
a) Let X and Y be independent random variables both with the same mean µ=0. Define a new random variable W = aX +bY, where a and b are constants. (i) Obtain an expression for E(W).
The table below shows the estimated effects for a logistic regression model with squamous cell esophageal cancer (Y = 1, yes; Y = 0, no) as the response. Smoking status (S) equals 1 for at least one pack per day and 0 otherwise, alcohol consumption (A) equals the average number of alcohoic drinks consumed per day, and race (R) equals 1 for blacks and 0 for whites.
Variable
Effect (β)
P-value
Intercept
-7.00
<0.01
Alcohol use
0.10
0.03
Smoking
1.20
<0.01
Race
0.30
0.02
Race × smoking
0.20
0.04
Write-out the prediction equation (i.e., the logistic regression model) when R = 0 and again when R = 1. Find the fitted Y S conditional odds ratio in each case.
Next, write-out the logistic regression model when S = 0 and again when S = 1. Find the fitted Y R conditional odds ratio in each case.
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