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

Andrew is helping his mom remodel his room, The perimeter of Andrew''s rect...

The perimeter of Andrew''s rectangular room is 44 feet. What equation was used to find the perimeter?

Estimate root of given equations, The positive value of k for which x 2 +K...

The positive value of k for which x 2 +Kx +64 = 0 & x 2 - 8x + k = 0 will have real roots . Ans: x 2 + K x + 64 = 0 ⇒  b 2 -4ac > 0 K 2 - 256 > 0 K

#algebra 2 .., encoded with the matrix -3 -7 and 4 9. what lights up a socc...

encoded with the matrix -3 -7 and 4 9. what lights up a soccer stadium? ecoded message: {-3 - 7} {3 2 } {3 6} {57 127} {52 127} {77 173} {23 51)

Explain basic concepts of parallel lines, Explain Basic Concepts of Paralle...

Explain Basic Concepts of Parallel Lines ? Parallel lines are defined in section 1.2 and we use "//" to denote it. From the definition, we can get the following two consequenc

About algebra, how do i compute an algebra number

how do i compute an algebra number

Alegrabra, how do you do algebra with division

how do you do algebra with division

Algebra, If a^n+1 + b^n+1/a^n + b^n is the arithmetic mean of a and b then ...

If a^n+1 + b^n+1/a^n + b^n is the arithmetic mean of a and b then find n. Answer:Arithmatic mean of a,b is =(a+b)/2  from the problem (a+b)/2=(a^n+1 +b ^n+1)/(a^n+b^n)  then (a+

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