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

Revenue and profit functions, Now let's move onto the revenue & profit func...

Now let's move onto the revenue & profit functions. Demand function or the price function Firstly, let's assume that the price which some item can be sold at if there is

Arithmetic progression, the radii of circular base of right circular cylind...

the radii of circular base of right circular cylinder and cone are in the ratio of 3:4 and their height are in the ratio of the 2:3 what is the ratio of their volume?

Credit and invoice, mr ouma bought two sets of spanners for sh 300per set ...

mr ouma bought two sets of spanners for sh 300per set two machanic vice at sh 1000each three set of screw driver at sh 115 per set and tool box for sh 300

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

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

''t'' distribution, The 't' distribution is a theoretical probability distr...

The 't' distribution is a theoretical probability distribution. The 't' distribution is symmetrical, bell-shaped, and to some extent similar to the standard normal curve. It has an

What is the connecticut sales tax on this item, Connecticut state sales tax...

Connecticut state sales tax is 6%. Lucy purchases a picture frame in which costs $10.50 What is the Connecticut sales tax on this item? Find out 6% of $10.50 by multiplying $10

Geometry, how much congruent sides does a trapezoid have

how much congruent sides does a trapezoid have

Standard normal distribution, Q. Describe Standard Normal Distribution? ...

Q. Describe Standard Normal Distribution? Ans. The Standard Normal Distribution has a mean of 0 and a standard deviation of 1. The letter Z is often used to refer to a sta

Algebra, how do i sole linear epuation

how do i sole linear epuation

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