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

Integerts, how do u add and subtract integers

how do u add and subtract integers

Finding the side of a triangle only using equations, In triangle DEF, angle...

In triangle DEF, angle E is congruent to angle F. If side DE = 3x-6, Side EF = x+2 and Side DF = 18-5x. Find the length of side DE

Ratios, a muffin recipe calls for three forth of a cup of sugar and one eig...

a muffin recipe calls for three forth of a cup of sugar and one eight of a cup of butter. travis accidentally put in one whole cup of butter. how much sugar does travis need to put

Determine the derivative f ( x ) = 2 x2 -16x + 35, Determine the derivative...

Determine the derivative of the following function by using the definition of the derivative. f ( x ) = 2 x 2 -16x + 35 Solution Thus, all we actually have to do is to pl

If an item costs $1.45 to what amount will louise round, Louise is estimati...

Louise is estimating the cost of the groceries in her cart. She rounds the cost of every item to the nearest dollar to form her calculations. If an item costs $1.45, to what amount

Use the definition of the right- and left-handed limits, Use the definition...

Use the definition of the limit to prove the given limit. Solution Let ε> 0 is any number then we have to find a number δ > 0 so that the following will be true. |

Prove that bd/cd = bf/ce, In the given figure, ∠AEF=∠AFE and E is the mid-p...

In the given figure, ∠AEF=∠AFE and E is the mid-point of CA. Prove that BD/CD = BF/CE Ans:    Draw CG ¦DF In ΔBDF CG ¦ DF ∴ BD/CD = BF/GF     .............(1)

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