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

Real numbers, prove root 2 as irrational number

prove root 2 as irrational number

staticis, a statisics professor plans classes so carefully that the length...

a statisics professor plans classes so carefully that the lengths of her classes are uniformly distributed between 46.0 and 56.0 minutes. find the probability that a given class pe

The hurwiz method, The Hurwiz method Hurwiz method was the concept of c...

The Hurwiz method Hurwiz method was the concept of coefficient of optimism or pessimism introduced by L. Hurwicz. The decision maker takes into account both the minimum and max

Surface area of prisms , Can you help me find out how to find the surface a...

Can you help me find out how to find the surface area of a prism

Project, transportation problem project

transportation problem project

Arithmetico geometric progression, find the sum of the following series upt...

find the sum of the following series upto n terms: 1*2+2*4+3*8+4*16+.....

Find the cost price of the toy, A dealer sells a toy for Rs.24 and gains as...

A dealer sells a toy for Rs.24 and gains as much percent as the cost price of the toy. Find the cost price of the toy. Ans:    Let the C.P be x ∴Gain = x % ⇒ Gain = x

Objectives of addition and subtraction, Objectives After going throu...

Objectives After going through this unit, you should be able to 1. explain the processes involved ih addition and subtraction; 2. plan and execute activities that woul

First order differential equations, In this section we will consider for so...

In this section we will consider for solving first order differential equations. The most common first order differential equation can be written as: dy/dt = f(y,t) As we wil

Find the third vertex of a triangle, Find the third vertex of a triangle if...

Find the third vertex of a triangle if its two vertices are (-1, 4) and (5, 2) and mid point of one side is (0, 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