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

Duality, how management making future decition by using duality

how management making future decition by using duality

Theorem on intervals of validity, Theorem Consider the subsequent IVP....

Theorem Consider the subsequent IVP. y′ =  p (t ) y = g (t )  y (t 0 )= y 0 If p(t) and g(t) are continuous functions upon an open interval a o , after that there i

H, 6987+746-212*7665

6987+746-212*7665

Which formula he use if he does not paint bottom of tank, Al is painting a ...

Al is painting a right cylinder storage tank. In sequence to purchase the correct amount of paint he requires to know the total surface area to be painted. Which formula will he us

Money, how do you add 1,ooo and 100?

how do you add 1,ooo and 100?

What is terminology of quadratic functions, What is Terminology of Quadrati...

What is Terminology of Quadratic Functions ? The function in x given by: F(x) = ax 2 + bx + c, where a 0 is called a quadratic function. The graph of a quadratic function is

Variance, Variance Consider the example of investment opportunities. Th...

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 befo

Quadratic equation, If roots of (x-p)(x-q) = c are a and b what will be th...

If roots of (x-p)(x-q) = c are a and b what will be the roots of (x-a)(x-b) = -c please explain. Solution)  (x-p)(x-q)=c x2-(p+q)x-c=0 hence,   a+b=p+q  and    a.b=pq-c

Percentage, A person spent 12.5% of his money and then rs.1600 and then 40%...

A person spent 12.5% of his money and then rs.1600 and then 40% of the remaining,now left rs.960 with him.What is his original money?

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