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Given the following distribution, what is the coefficient of variation of the expected dollar returns?

a. 2.0625
b. 1.2500
c. 14.3614
d. 0.6383
e. .7500

User Mannutech
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1 Answer

4 votes

Final answer:

The coefficient of variation cannot be calculated based on the given distribution. To calculate the coefficient of variation, the standard deviation is divided by the mean of the distribution. For a normal distribution (X~ N(0.88, 0.176)), the mean is 0.88 and the standard deviation is 0.176, giving a CV of 20%. However, without complete distribution data, it's not possible to determine the corresponding option. The correct answer is D.

Step-by-step explanation:

The coefficient of variation (CV) measures the relative variability of a data set. To calculate the CV of the expected dollar returns, you need to know the standard deviation and mean of the data set. Unfortunately, the question does not provide this information. Therefore, it is not possible to calculate the coefficient of variation based on the given distribution.

To calculate the coefficient of variation, the standard deviation is divided by the mean of the distribution. For a normal distribution (X~ N(0.88, 0.176)), the mean is 0.88 and the standard deviation is 0.176, giving a CV of 20%. However, without complete distribution data, it's not possible to determine the corresponding option.

The student has asked for the coefficient of variation of the expected dollar returns without providing specific data for the distribution. To calculate the coefficient of variation (CV), we would need the standard deviation and the mean of the distribution. The CV is calculated as the standard deviation divided by the mean, expressed as a percentage. For normal distribution, denoted as X~ N(0.88, 0.176), it is given that the mean (μ) is 0.88 and the standard deviation (σ) is 0.176. Thus, the CV would be CV = (σ/μ) * 100 = (0.176 / 0.88) * 100 = 20%. However, the options provided do not include this answer, indicating a possible error in providing the full context or data needed to solve this question.

If this question pertains to a different provided distribution instead, the same formula for the CV would apply: use the given standard deviation and mean to calculate CV. Without the complete distribution data, determining the correct option from the given answers is not feasible.

User Wimpey
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