Variance, Mathematics

Assignment Help:

Variance

Consider the example of investment opportunities. The expected gains were Rs.114 and Rs.81 respectively. The fact is that an investor also looks at the dispersion before coming to a decision.

501_variance.png

The dispersion of opportunity 1 is far greater than that of opportunity 2. This might alarm the investor.

In this example, it might be worthwhile to compute the coefficient of variation.

For opportunity 1, this works out to be

= (42/114) x 100 = 36.84%

For opportunity 2, this works out to be

= (29.14/81) x 100  = 35.97%

The investor may regard both opportunities homogeneous in this regard and therefore find opportunity 1 more attractive (because of the higher expected returns).

 


Related Discussions:- Variance

Prove that its inclination is given by cot = b cot - a, Two stations due...

Two stations due south of a leaning tower which leans towards the north are at distances a and b from its foot.  If α ,  β be the elevations of the top of the tower from these

Subtraction of like terms with same signs, Suppose we are required to...

Suppose we are required to find the difference between 3abc and 7abc. We look at two scenarios. The value we would obtain by subtracting a larger quantity from th

Properties of dot product - proof, Properties of Dot Product - proof P...

Properties of Dot Product - proof Proof of: If v → • v → = 0 then v → = 0 → This is a pretty simple proof.  Let us start with v → = (v1 , v2 ,.... , vn) a

Exact differential equations, The subsequent type of first order differenti...

The subsequent type of first order differential equations which we'll be searching is correct differential equations. Before we find in the full details behind solving precise diff

Precalculus, Find the standard form of the equation of the parabola with a ...

Find the standard form of the equation of the parabola with a vertex at the origin and a focus at (0, -7).

How many solutions are there for differential equation, If a differential e...

If a differential equation does have a solution how many solutions are there? As we will see ultimately, this is possible for a differential equation to contain more than one s

Counters and registers, design a synchronous, recycling, MOD-12 counter wit...

design a synchronous, recycling, MOD-12 counter with D FF''s. Use the states 0000 through 1011 in the counter.

Graphs, How do I graph a round robin pool tournment with 6 players using gr...

How do I graph a round robin pool tournment with 6 players using graph theory

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd