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

Integral calculus, I need help to understand: fxx for f(x,y)=x^2+y^2-2xy

I need help to understand: fxx for f(x,y)=x^2+y^2-2xy

Computed the total cost y of a ride which was x miles, A ride in a taxicab ...

A ride in a taxicab costs $1.25 for the first mile and $1.15 for each additional mile. Which of the following could be used to computed the total cost y of a ride which was x miles

What are mutually exclusive events, Q. What are Mutually Exclusive events? ...

Q. What are Mutually Exclusive events? Mutually Exclusive Events are mutually exclusive if they cannot occur at the same time. For example, if you roll one die, you canno

What is exponents values, What is Exponents values? Exponents were inve...

What is Exponents values? Exponents were invented as a quick way to show that you are multiplying a number by itself several times. It's too much trouble to write something

Basic, 8l550ml - 1/4l =

8l550ml - 1/4l =

How many ways are there to seat these children, Question: (a) Suppose ...

Question: (a) Suppose that a cookie shop has four different kinds of cookies. Assuming that only the type of cookie, and not the individual cookies or the order in which they

Pi, is that rational or irrational number

is that rational or irrational number

Estimate how long did michael practice- algebra, Suppose that the number of...

Suppose that the number of hours Katie spent practicing soccer is represented through x. Michael practiced 4 hours more than 2 times the number of hours that Katie practiced. How l

Evolve a game to help children remember basic multiplication, Evolve a game...

Evolve a game to help children remember basic multiplication facts. In this section we have looked at ways of helping children absorb some simple multiplication facts. But what

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