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

Discrete uniform distribution, Discrete Uniform Distribution Acme Limit...

Discrete Uniform Distribution Acme Limited is a car manufacturer. The company can paint the car in 3 possible colors: White, Black and Blue. Until the population is sampled, th

Find out if the following series converges or diverges, Determine or find o...

Determine or find out if the following series converges or diverges.  If it converges find out its value. Solution We first require the partial sums for this series.

Reflection , How do you reflect about the origin

How do you reflect about the origin

Solve the subsequent lp problem, Solve the subsequent LP problem graphicall...

Solve the subsequent LP problem graphically through enumerating the corner points. MAX:              3X1 + 4X2 Subject to:    X1   12                     X2    10

In sequence to remain the pole perpendicular to the ground, A cable is atta...

A cable is attached to a pole 24 ft above ground and fastened to a stake 10 ft from the base of the pole. In sequence to remain the pole perpendicular to the ground, how long is th

Congruence, a) Let n = (abc) 7 . Prove that n ≡ a + b + c (mod 6). b) U...

a) Let n = (abc) 7 . Prove that n ≡ a + b + c (mod 6). b) Use congruences to show that 4|3 2n   - 1 for all integers n ≥ 0.

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