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

Quadratic Equations, how to find minimum value of quadratic equation?

how to find minimum value of quadratic equation?

Graphs, How do I graph a round robin pool tournment with 6 players using gr...

How do I graph a round robin pool tournment with 6 players using graph theory

What are factor trees explain, What are Factor Trees explain? In algebr...

What are Factor Trees explain? In algebra, we often need to factor a number into its prime factors. One way to do this is to use a factor tree. This is a network of numbers, st

Integrals involving trig functions - integration techniques, Integrals Invo...

Integrals Involving Trig Functions - Integration techniques In this part we are going to come across at quite a few integrals that are including trig functions and few metho

Conditional probability: dependent events, We can define the conditional pr...

We can define the conditional probability of event A, given that event B occurred when both A and B are dependent events, as the ratio of the number of elements common in both A an

Alphabet is any arrangement , A word on an alphabet is any arrangement of t...

A word on an alphabet is any arrangement of the letters in the alphabet. For example,ODD, DOD, DOO, DDD are three-letter words on the alphabet {D,O}. How many four-letter words are

What is the vertex form for a quadratic equation, What is the Vertex Form f...

What is the Vertex Form for a Quadratic Equation ? The vertex form for a quadratic function is as follows: f(x) = a(x - h) 2 + k The graph of this function Is a parabola whos

Differential calculus, lim n tends to infintiy ( {x} + {2x} + {3x}..... +{n...

lim n tends to infintiy ( {x} + {2x} + {3x}..... +{nx}/ n2(to the square) )where {X} denotes the fractional part of x? Ans) all no.s are positive or 0. so limit is either positive

Speed, how much distance is covered by a man if he is travelling at a speed...

how much distance is covered by a man if he is travelling at a speed of 45km/h in 5 sec

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