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

Find out the radius of convergence, Example: Find out the radius of conver...

Example: Find out the radius of convergence for the following power series. Solution : Therefore, in this case we have, a n = ((-3) n )/(n7 n+1 )   a n+1 = (

What do you mean by transient state, What do you mean by transient state an...

What do you mean by transient state and steady-state queueing systems If the characteristics of a queuing system are independent of time or equivalently if the behaviour of the

Chanllenge, a pizza driver delivered 27 pizzas in one night he delivered mo...

a pizza driver delivered 27 pizzas in one night he delivered more then one pizza to only one house . every other house he only delivered pizza to 18 houses . how many pizzas did he

Fractions, how to add a fraction with an uncommon denomoninator

how to add a fraction with an uncommon denomoninator

What is metric system explain in brief, What is Metric System explain in br...

What is Metric System explain in brief? There are two main systems of measurement in use today. Most countries in the world use the Metric System. In only three countries-the

Solve the limit problem, Solve the Limit problem as stated  Limit x tends...

Solve the Limit problem as stated  Limit x tends to 0 [tanx/x]^1/x^2 is ? lim m tends to infinity [cos (x/m)] ^m is? I need the procedure of solving these sums..

What is the smaller probable value of this number, The sum of the square of...

The sum of the square of a number and 12 times the number is -27. What is the smaller probable value of this number? Let x = the number.  The statement that is "The sum of the

Taylor series - sequences and series, Taylor Series - Sequences and Series ...

Taylor Series - Sequences and Series In the preceding section we started looking at writing down a power series presentation of a function.  The difficulty with the approach

Power series and functions - sequences and series, Power Series and Functio...

Power Series and Functions We opened the previous section by saying that we were going to start thinking about applications of series and after that promptly spent the section

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