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

The laplace method, The Laplace method Laplace method employs all the i...

The Laplace method Laplace method employs all the information by assigning equal probabilities to the possible payoffs for every action and then selecting such alternative whic

Find out a if f(x) is continuous at x = -2 , Example   Given the graph of ...

Example   Given the graph of f(x), illustrated below, find out if f(x) is continuous at x = -2 , x = 0 , and x = 3 . Solution To give answer of the question for each

Quadratic equation whose roots are real, Write the quadratic equation whose...

Write the quadratic equation whose roots are real and non conjugate Ans)  x^2-x+6=0 ...roots are real and non conjugate

Determine and classify all critical points , Determine and classify all the...

Determine and classify all the critical points of the given function.  Described the intervals where function is increasing & decreasing. Solution: Firstly we'll require

Multiplying fractions involving negative numbers, Q. Multiplying Fractions ...

Q. Multiplying Fractions Involving Negative Numbers? Ans. If you have only one negative sign, the result is still negative: If you have more than one, just remembe

Illustrate Ionic solids, Ionic solids, which have anionic vacancies because...

Ionic solids, which have anionic vacancies because of metal excess defect develop colour. Illustrate with the help of a suitable example.

Estimating sums, round to the nearest ten to estimate , 422+296

round to the nearest ten to estimate , 422+296

Binomial, how do you find the co=efficent when there are two brackets invol...

how do you find the co=efficent when there are two brackets involved?

Ravens played 25 home games how many games did they win, The Ravens played ...

The Ravens played 25 home games this year. They had 9 losses and 2 ties. How many games did they win? Eleven games are accounted for along with the losses and ties (9 + 2 = 11)

MATH HELP: URGENT, the andersons are buying a new home and need to fence th...

the andersons are buying a new home and need to fence their yard. the yard is 40 ft by 80 ft. each fencing section is 8ft. how many sections will they need?how many posts will they

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