The profit (or loss) from an investment is normally distributed with a mean of $11,200 and a

Question:

The profit (or loss) from an investment is normally distributed with a mean of $11,200 and a standard deviation of $8,250.

a. What is the probability that there will be a loss rather than a profit?

b. What is the probability that the profit will be between $10,000 and $20,000?

c. Find x such that the probability that the profit will exceed x is 25%.

d. If the loss exceeds $10,000 the company will have to borrow additional cash. What is the probability that the company will have to borrow additional cash?

e. Calculate the value at risk.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Complete Business Statistics

ISBN: 9780077239695

7th Edition

Authors: Amir Aczel, Jayavel Sounderpandian

See More Books

Question Posted: Jun 03, 2015 05:51 AM

See More Questions

A random variable is normally distributed with a mean of 60 and a standard deviation of 9. a. What is the probability that a randomly selected value from the distribution will be less than 46.5? b....
A random variable is normally distributed with a mean of 25 and a standard deviation of 5. If an observation is randomly selected from the distribution, a. What value will be exceeded 10% of the...
If freeway speeds are normally distributed with a mean of = 70 mph and = 7 mph, find the probability that the speed of a randomly chosen vehicle (a) Exceeds 78 mph; (b) Is between 65 and 75 mph;...
Tony acquired 1,000 shares in X Co (a resident public company) for $10 each in August 2000. In January this year X Co returned $7 of capital to its shareholder in respect to each share they held. The...
Why do economists believe that pollution taxes and effluent permits are a more efficient way to curb pollution than laws mandating across-the-board cutbacks?
Saks Fifth Avenues balance sheet for a recent year revealed the following information: Current assets ...................................... $750,000 Noncurrent assets...
Consider the [102] model \[\begin{aligned}d S_{t} & =\mu_{S} S_{t} d t+\sqrt{Y_{t}} S_{t} d B_{t} \\d Y_{t} & =\mu_{Y} Y_{t} d t+\xi Y_{t} d W_{t}\end{aligned}\] The volatility process is...
Based on the information given, indicate whether the following industry is best characterized by the model of perfect competition, monopoly, monopolistic competition, or oligopoly. a. Industry A has...
Requirement 2. Compute the total costs of the units (gallons) (a) completed and transferred out to the Packaging Department, and (b) in the Blending Department ending Work-in-Process Inventory....
San Mateo Health Care Inc. is owned and operated by Rachel Fields, the sole stockholder. During January 20Y6, San Mateo Health Care entered into the following transactions: Jan. 1 Received $27,000...
The GMAT scores of students who are potential applicants to a university are normally distributed with a mean of 487 and a standard deviation of 98. a. What percentage of students will have scores...
The weight of connecting rods used in an automobile engine is to be closely controlled to minimize vibrations. The specification is that each rod must be 974 1.2 grams. The half-width of the...
Assume you are Fitter Snackers new marketing manager, hired to clean up some of the companys problems, as outlined in the beginning of this chapter. You just started this job, and you are getting to...
For an investment horizon from 1926 to 2021, which of the following investments had the highest return: the S&P 500, small stocks, world portfolio, corporate bonds, or Treasury bills? Which had the...
NoGrowth Corporation currently pays a dividend of $1.36 per year, and it will continue to pay this dividend forever. What is the price per share if its equity cost of capital is 15% per year?
We have 96 years of data on the S&P 500 returns, yet we cannot estimate the expected return of the S&P 500 very accurately. Why?
Suppose Pepsicos stock has a beta of 0.72. If the risk-free rate is 2% and the expected return of the market portfolio is 6%, what is Pepsicos equity cost of capital?
How can you use a securitys beta to estimate its cost of capital?
If you were going to design a chlamydia prevention campaign, what age group would you suggest targeting? Why? Refer to the graph in Figure 2-13. FIGURE 2-13 Incidence of Chlamydia in Florida by Age...
In exchange for land, the company received a 12-month note on January 1. The face amount of the note is $1,000, and the stated rate of interest is 13%, compounded annually. The 13% rate is equal to...
The following data represent the ages of chief justices of the U.S. Supreme Court when they were appointed. Justice .......Age John Jay .......44 John Rutledge.....56 Oliver Ellsworth ....51 John...
As part of a statistics project, a student surveys 30 randomly selected students and asks them how many speeding tickets they have been issued in the past month. The results of the survey are as...
Suppose that a certain brand of light bulb has a mean life of 600 hours and a standard deviation of 53 hours. (a) A histogram of the data indicates the sample data follow a bell-shaped distribution....
"Managing Away Bad Habits Team Assignment Organizational Behavior IILeadership Assigned is ashort case from the exercise Managing Away Bad Habits. The task is to develop a turnaround strategy for...
"Managing Away Bad Habits Team Assignment Organizational Behavior IILeadership Assigned is ashort case from the exercise Managing Away Bad Habits. The task is to develop a turnaround strategy for...
11 The APRN unit director is working at an agency that has a high incidence of medication errors, specifically with heparin. One recent error had a patient receive twice the prescribed dose. Which...

The profit (or loss) from an investment is normally distributed with a mean of $11,200 and a

Question:

Step by Step Answer:

a PX 0 00873 b P 10000 X 20000 04148 c PX x 025 x ...View the full answer

Complete Business Statistics

Students also viewed these Statistics questions