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

How much area will it irrigate in 30 minutes , Water in a canal 30 dm wide ...

Water in a canal 30 dm wide and 12 dm deep is flowing with a velocity of 10 km/h. How much area will it irrigate in 30 minutes if 8 cm of standing water is required for irrigation?

Determine the eigenvalues and eigenvectors of the matrix, Determine the eig...

Determine the eigenvalues and eigenvectors of the subsequent matrix. Solution : The first thing that we require to do is determine the eigen-values. It means we require

Evaluate the volume and surface area of a rectangular solid, Evaluate the v...

Evaluate the volume and surface area of a rectangular solid: Calculate the volume & surface area of a rectangular solid along with a =   3", b = 4", & c = 5".  Solution:

Indices, what are the advantages and disadvantages of both Laspeyres and Pa...

what are the advantages and disadvantages of both Laspeyres and Paasche index

Find out the hydrostatic force on the triangular plate, Find out the hydros...

Find out the hydrostatic force on the following triangular plate that is submerged in water as displayed. Solution The first thing to do here is set up an axis system

Define points, Define Points, Lines, and Spaces Points, lines, and planes...

Define Points, Lines, and Spaces Points, lines, and planes are known as undefined or primitive terms. These are the most significant and fundamental concepts in the study of geom

Common graphs, Common Graphs : In this section we introduce common graph o...

Common Graphs : In this section we introduce common graph of many of the basic functions. They all are given below as a form of example Example   Graph y = - 2/5 x + 3 .

Calculate the instantaneous rate of change of the volume, Assume that the a...

Assume that the amount of air in a balloon after t hours is specified by                                             V (t ) = t 3 - 6t 2 + 35 Calculate the instantaneous

Machines, descuss the seauencing problem for n jobs on two and three machin...

descuss the seauencing problem for n jobs on two and three machines

Complex numbers, find the modulus Z=(2-i)(5+i12)/(1+i2)^3

find the modulus Z=(2-i)(5+i12)/(1+i2)^3

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