Regarding the law of large numbers

Assignment Help Financial Management
Reference no: EM13913864

Which of the following statements is correct regarding the law of large numbers?

a. it is only effective if the events being forecast are independent of one another, and have occurred in the past under substantially identical condition

b. it states that the inaccuracy between the empirical frequency and the theoretical probability will increase as the sample size increases

c. it indicates that as the uncertain surrounding the expected results decreases, the likelihood decreases that the range of outcomes will very widely

d. it represents the tendency for individuals who are highly vulnerable to loss from a specific risk to be inclined to purchase insurance

Reference no: EM13913864

Questions Cloud

Prepare the journal entry : For each transaction above, prepare the journal entry
Yeager company pays john kerr a salary : Yeager Company pays John Kerr a salary as an employee and also fees for work he does as an independent contractor.
Counted as balance of payments transaction : Which of the following international transactions would NOT be counted as a balance of payments (BOP) transaction? PLEASE EXPLAIN YOUR REASONING
What is the amount of its stockholders equity : Ambria Company's assets are $240,000, and its liabilities are $90,000. What is the amount of its stockholders' equity?
Regarding the law of large numbers : Which of the following statements is correct regarding the law of large numbers?
What is the pre-tax cost of debt : ABC Co. has an annual bond outstanding that matures in 10 years and pays a 6 percent coupon. The bond has a market value of $1,200. What is the pre-tax cost of debt?
What was the stockholders equity at the end of the year : During the year, assets increased by $30,000 and liabilities increased by $5,000. What was the stockholders' equity at the end of the year?
Expected to pay an annual dividend in the amount : ABC Corp. is expected to pay an annual dividend in the amount of $2.50 a share next year. This dividend constantly grows by 5 percent per year. The current price of the company’s stock is $50.60 per share. What is the cost of equity?
Perpetual inventory system : Prepare the journal entries to record these transactions on Bernadina Companys books under a perpetual inventory system. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the o..

Reviews

Write a Review

Financial Management Questions & Answers

  Theme of cloud computing

Different places as it moves from office to living room and into our pockets and where is this all headed.

  Why might a retired person prefer dividends to capital gains

Based solely on the tax treatment of dividends why might a retired person prefer dividends to capital gains and explain why the Bird-in-the-Hand explanation of dividend policy is a fallacy.

  What is the duration if the yield to maturity

Find the duration of a 8.0% coupon bond making semi annually coupon payments if it has 3 years until maturity and has a yield to maturity of 8.0%. What is the duration if the yield to maturity is 10.0%?

  Financial intermediaries perform that benefit society

What are the economic functions that financial intermediaries perform that benefit society? In your answer, discuss the relationship of financial intermediaries and financial markets to the savings-investment process within an economy and to each oth..

  What is the value per share of common stock

It is January 2015. You work as a financial analyst for Merck & Co. and are tasked with the due diligence on the proposed acquisition of a biotech startup. You estimated the following cash flows for the startup:  What is the terminal value, i.e., the..

  Determine amount that will be capitalized for installation

A proposal has been made to purchase a machining center at a price of $950,000. The delivery will cost an additional $12,000. It will take a three-person maintenance crew two standard 40-hour weeks that earn $25 an hour each to install the needed ele..

  What is your portfolio return

Portfolio Return At the beginning of the month, you owned $6,200 of Company G, $8,500 of Company S, and $2,000 of Company N. The monthly returns for Company G, Company S, and Company N were 7.75 percent, -1.55 percent, and -.18 percent. What is your ..

  Differentiate between the short run and long run

Let’s assume that you own a fast food restaurant and you are faced with many customers each day eating in the restaurant without any tables. Describe the difference between the short run and long run in the example to bringing about more tables for t..

  About the firms discount rate

Your firm’s discount rate is 10 percent. You are considering the purchase of Truck A or Truck B. Truck A costs $100, has a useful life of 3 years, no salvage value and maintenance costs of $10 per year. Truck B costs $80, has a useful life of 2 years..

  The required return for each companys stock

Red, Inc., Yellow Corp., and Blue Company each will pay a dividend of $2.60 next year. The growth rate in dividends for all three companies is 4 percent. The required return for each company’s stock is 6 percent, 9 percent, and 12 percent, respective..

  Half-year convention deprecation

KOOKIS, Inc., has developed a new cooky. The firm is planning to spend $60,000 on a new oven to produce the new cooky for 3 years. The machine has an expected life of three years, a $10,000 estimated resale value, and falls under the straight-line 3-..

  Forecasting cash flows

Your company is forecasting cash flows of $15 million next year, $25 million in year 2 and $40 million in year 3. After that growth in cash flows is expected to level out at 5% per year. Your company has $150 million in marketable securities and $350..

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