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

RATIO, 3 years to 104 weeks,express answer in ratio

3 years to 104 weeks,express answer in ratio

Algebra 1A, The m&m factory produces 2,500 packs of plain m&ms each day. R...

The m&m factory produces 2,500 packs of plain m&ms each day. Represent the total number of packs of plain m&ms the factory makes each day

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 are the angles of depression from observing position, In Figure, what ...

In Figure, what are the angles of depression from the observing positions O 1 and O 2 of the object at A?

Money, What is the formulate of finding commission

What is the formulate of finding commission

Find a general solution to the differential equation, Example: Find a gene...

Example: Find a general solution to the subsequent differential equation. 2 y′′ + 18 y + 6 tan (3t) Solution First, as the formula for variation of parameters needs coe

Problem solving sentence, a cheeseburger cost $6.39 more than a burger of $...

a cheeseburger cost $6.39 more than a burger of $2.29, what is the difference?

Duality, how management making future decition by using duality

how management making future decition by using duality

Functions of limits, Following is some more common functions that are "nice...

Following is some more common functions that are "nice enough". Polynomials are nice enough for all x's. If f ( x) = p ( x ) /q (x ) then f(x) will be nice enough provid

Differential equatoin, how to solve questions based on higher differential ...

how to solve questions based on higher differential equations

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