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

Trigonometry, can you explain it to me please

can you explain it to me please

Solution process of linear differential equations, For a first order linear...

For a first order linear differential equation the solution process is as given below: 1. Place the differential equation in the correct initial form, (1). 2. Determine the i

Calculate the volume and surface area of a cube, Calculate the volume and s...

Calculate the volume and surface area of a cube: Calculate the volume and surface area of a cube with a = 3".  Be sure to involved units in your answer. Solution: V =

What was the original price of the coat before tax, Nick paid $68.25 for a ...

Nick paid $68.25 for a coat, including sales tax of 5%. What was the original price of the coat before tax? Since 5% sales tax was added to the cost of the coat, $68.25 is 105%

What is the probability in which the marble chosen is blue, A bag holds 3 r...

A bag holds 3 red, 6 blue, 5 purple, and 2 orange marbles. One marble is selected at random. What is the probability in which the marble chosen is blue? The probability of blue

Ecercises, ne nje tabak letre me permasa 100cm dhe 55cm nje nxenes duhet te...

ne nje tabak letre me permasa 100cm dhe 55cm nje nxenes duhet te ndertoje nje kuboide me permasa 20cm,25cm,40cm. a mund ta realizoje kete, ne qofte se per prerjet dhe ngjitjet humb

Volume of grains in the silo , The volume of grains in a silo at a particul...

The volume of grains in a silo at a particular time (measured in hours) is given by V (t) = 4t(3-t) m3. Find the rate of change of the volume of grains in the silo from first princ

Invertible Matrices - Logical equivalence, 10 statements must be shown to b...

10 statements must be shown to be logically equivalent to the Statement the nxn matrix is invertible.

Arithmetic mean, When three quantities are in A.P., then the middle...

When three quantities are in A.P., then the middle one is said to be the arithmetic  mean of the other two. That is, if a, b and c are in A.P., then b is 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