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

Determine the solution to the differential equation, Determine the solution...

Determine the solution to the subsequent differential equation. dv/dt = 9.8 - 0.196v Solution Initially we require finding out the differential equation in the accurate

Find the average, The center of a national park is located at (0,0). A spec...

The center of a national park is located at (0,0). A special nature preserve is bounded by by straight lines connecting the points A at (3,2), B at (5,1), C at (8,4) and D at (6,5)

Number sentences, when i couulate the formula f 64 divided by 65 how do i d...

when i couulate the formula f 64 divided by 65 how do i do this

How to solve systems of equations, How to solve Systems of Equations ? ...

How to solve Systems of Equations ? There's a simple method that you can use to solve most of the systems of equations you'll encounter in Calculus. It's called the "substitut

Definition and fact of the shape of a graph, Definition 1.   Given any ...

Definition 1.   Given any x 1  & x 2   from an interval  I with x 1 2  if f ( x 1 ) 2 ) then f ( x ) is increasing on I. 2.   Given any x 1  & x 2  from an interval

Factors, write down all the factors of 36

write down all the factors of 36

The expected monetary value method, The expected monetary value method ...

The expected monetary value method The expected pay off as profit associated with a described combination of act and event is acquired by multiplying the pay off for that act a

If the area of the parallelogram is 36 m2 what is the height, The height of...

The height of a parallelogram measures 5 meters more than its base. If the area of the parallelogram is 36 m 2 , what is the height in meters? Let x = the measure of the base a

Example of a function - inflection point, 1. (a) Give an example of a funct...

1. (a) Give an example of a function, f(x), that has an inflection point at (1, 4). (b) Give an example of a function, g(x), that has a local maximum at ( -3, 3) and a local min

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