Question: Based on the data in Figure 12.10 and assuming that security returns are distributed normally, what is the probability that, in a given year, small-company

Based on the data in Figure 12.10 and assuming that security returnsBased on the data in Figure 12.10 and assuming that security returns are distributed normally, what is the probability that, in a given year, small-company stocks will have a return greater than the historical average return for large-company stocks?

  • A. 0.735
  • B. 0.654
  • C. 0.379
  • D. 0.425
  • E. 0.876

Average Return Standard Deviation Frequency Distribution Series Large-company stocks 12.1% 20.2% | Small-company stocks 16.9 32.3 hom. Long-term corporate bonds 6.3 8.4 Long-term government bonds 5.9 9.8 . Intermediate-term government bonds 5.4 5.7 U.S. Treasury bills 3.5 3.1 II. Inflation 3.0 4.1 .... Average Return Standard Deviation Frequency Distribution Series Large-company stocks 12.1% 20.2% | Small-company stocks 16.9 32.3 hom. Long-term corporate bonds 6.3 8.4 Long-term government bonds 5.9 9.8 . Intermediate-term government bonds 5.4 5.7 U.S. Treasury bills 3.5 3.1 II. Inflation 3.0 4.1

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