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

Differential equations, solve the differential equation 8yk+2-6yk+1+yk=9 ,k...

solve the differential equation 8yk+2-6yk+1+yk=9 ,k=0 given that Y0=1 and y1=3/2

Example of 3-d coordinate system, Example of 3-D Coordinate System Exam...

Example of 3-D Coordinate System Example: Graph x = 3 in R, R 2 and R 3 .   Solution In R we consist of a single coordinate system and thus x=3 is a point in a 1-D co

How long will it take him to plow 21 acres, Mr. Brown plowed 6 acres in 1 h...

Mr. Brown plowed 6 acres in 1 hour. At this rate, how long will it take him to plow 21 acres? Mr. Brown plows 6 acres an hour, so divide the number of acres (21) through 6 to f

By the method of completion of squares solve equation, By the method of com...

By the method of completion of squares show that the equation 4x 2 +3x +5 = 0 has no real roots. Ans:    4 x 2 +3 x +5=0 ⇒  x 2 + 3/4 x + 5 = 0 ⇒   x 2 + 3/4 x +

Sketch the graphs, Sketch the graphs of the following functions: (A) y =...

Sketch the graphs of the following functions: (A) y = 1/(x 2 +1) (b) x=  sin x,

Consecutive positive odd integers 74 what is integer value, The sum of the ...

The sum of the squares of two consecutive positive odd integers is 74. What is the value of the smaller integer? Let x = the lesser odd integer and let x + 2 = the greater odd

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