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

Limit, limit x APProaches infinity (1+1/x)x=e

limit x APProaches infinity (1+1/x)x=e

Evaluate limit in indeterminate form, Evaluate following limits. S...

Evaluate following limits. Solution In this case we also contain a 0/0 indeterminate form and if we were actually good at factoring we could factor the numerator & den

Linear equations, Linear Equations We'll begin the solving portion of ...

Linear Equations We'll begin the solving portion of this chapter by solving linear equations. Standard form of a linear equation: A linear equation is any equation whi

Simple derivatives, Simple derivatives Example   Differentiate followin...

Simple derivatives Example   Differentiate following.  (5x 3   - 7 x + 1) 5 ,[ f ( x )] 5 ,[ y ( x )] 5 Solution: Here , with the first function we're being asked to

Transpose of a matrix, I didn't understand the concept of Transpose of a Ma...

I didn't understand the concept of Transpose of a Matrix, need assistance.

What is uniform distribution, Q. What is Uniform Distribution? Ans. ...

Q. What is Uniform Distribution? Ans. A distribution is the set of possible values of a random variable considered in terms of their theoretical or observed frequency. Th

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