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

Progressions, * 2^(1/2)*4^(1/8)*8^(1/16)*16^(1/32) =

* 2^(1/2)*4^(1/8)*8^(1/16)*16^(1/32) =

Algebra, how do you solve quadratic equations by factoring?

how do you solve quadratic equations by factoring?

Addition and subtraction of rational expressions, Now come to addition and ...

Now come to addition and subtraction of rational expressions.  Following are the general formulas.  (a/c) + (b/c) = (a + b)/c

Rank correlation coefficient, Rank Correlation Coefficient Also ident...

Rank Correlation Coefficient Also identified as the spearman rank correlation coefficient, its reasons is to establish whether there is any form of association among two vari

Damping force, The subsequent force that we want to consider is damping. Th...

The subsequent force that we want to consider is damping. This force may or may not be there for any specified problem. Dampers work to counteract any movement. There are some w

Linear programming , use the simplex method to solve the following lp probl...

use the simplex method to solve the following lp problem. max z = 107x1 + x2 + 2x3 subject to 14x1 + x2 - 6x3 + 3x4 = 7 16x1 + x2 - 6x3 3x1 - x2 - x3 x1,x2,x3,x4 > = 0

How many total inches of wood does he have, Eduardo is merging two 6-inch p...

Eduardo is merging two 6-inch pieces of wood with a piece in which measures 4 inches. How many total inches of wood does he have? This problem translates to the expression 6 ×

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