Compute possible outcomes of probability distribution

Reference no: EM1373105

In the following given questions the potential investment has following range of possible outcomes and probabilities: 10% probability of a -20 percent return, 40% probability of a 15 percent return, 40% probability of a 25 percent return, and a 10% probability of a 50 percent return. [A] Compute the weighted mean of the probability distribution; [B] Compute the variance of the probability distribution; [C] Compute the standard deviation of the probability distribution. [D] Compute the coefficient of variation of the probability distribution. [E] Would another investment having a coefficient of variation of .25 appear to offer a higher return / unit of risk?

Reference no: EM1373105

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