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

Integration and differentiation, Integration and Differentiation Diffe...

Integration and Differentiation Differentiation deals along with the determination of the rates of change of business activities or merely the process of finding the derivativ

Arc length for parametric equations, Arc Length for Parametric Equations ...

Arc Length for Parametric Equations L = ∫ β α √ ((dx/dt) 2 + (dy/dt) 2 ) dt Note: that we could have utilized the second formula for ds above is we had supposed inste

The bionomial theorem for rational index, use the bionomial theorem to expa...

use the bionomial theorem to expand x+2/(2-X)(WHOLE SQUARE 2)

.., Ask quesLa proporción de empleados de una empresa que usan su auto para...

Ask quesLa proporción de empleados de una empresa que usan su auto para ir al trabajo es 5:16. Si hay un total de 800 empleados, diga la cantidad de autos que se espera que haya es

Marketing, In a 2500 word report do the market analysis of China. Under thi...

In a 2500 word report do the market analysis of China. Under this you have to explain: - What are the advantages and disadvantages for foreign company to set up its business cent

Rounding, what is the result if 816.537 is rounded to the nearest tenth

what is the result if 816.537 is rounded to the nearest tenth

Launching of a new product, Launching a new product (Blackberry Cube) Analy...

Launching a new product (Blackberry Cube) Analysis (target market) Product features Promotions and advertisement sample design (location)

Parameters of the poisson mixture model, Using R function nlm and your code...

Using R function nlm and your code from Exercise E1.2, write an R function called pois.mix.mle to obtain MLEs of the parameters of the Poisson mixture model.

What is the larger dimension in inches of the frame, Jessica has a picture ...

Jessica has a picture in a frame with a total area of 288 in2. The dimension of the picture without the frame is 12 in through 14 in. What is the larger dimension, in inches, of 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