Assume long-term government bonds

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Reference no: EM131328198

Suppose the returns on long-term government bonds are normally distributed. Assume long-term government bonds have a mean return of 5.9 percent and a standard deviation of 9.2 percent.

a. What is the probability that your return on these bonds will be less than −3.3 percent in a given year? Use the NORMDIST function in Excel® to answer this question. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

b. What range of returns would you expect to see 68 percent of the time? (A negative answer should be indicated by a minus sign. Input your answers from lowest to highest to receive credit for your answers. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

c. What range would you expect to see 95 percent of the time? (A negative answer should be indicated by a minus sign. Input your answers from lowest to highest to receive credit for your answers. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

Reference no: EM131328198

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