What is the probability of portfolio return on investment

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An investment consultant believes that the probability distribution of the return on investment (in percent per year) on a certain international portfolio is as given in Table 2.26. TABLE 2.26 Probability distribution of the return on investment of the international portfolio.Return on Investment (% per year)Probability xi pi 9 0.07 10 0.15 11 0.23 12 0.25 13 0.15 14 0.12 15 0.03

(a) Verify that the numbers in Table 2.26 correspond to a proper probability distribution.

(b) According to this consultant, what is the probability that the portfolio's return on investment will be at least 12%?

Reference no: EM132892978

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