When returns from a project can be assumed to be normally distributed, such as those shown...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
When returns from a project can be assumed to be normally distributed, such as those shown in Figure 13-6 (represented by a symmetrical, bell-shaped curve), the areas under the curve can be determined from statistical tables based on standard deviations. For example, 68.26 percent of the distribution will fall within one standard deviation of the expected value ( D= 10). Similarly, 95.44 percent will fall within two standard deviations (D20), and so on. An abbreviated table of areas under the normal curve is shown next Number of a's from Expected Value -and- 0.50 0.1915 0.3830 1.00 0.5415 9.6826 1.15 8.3749 8.7498 1.58 0:4332 0.3664 2.96 0.4985 0.9970 Assume Project A has an expected value of $26,000 and a standard deviation (a) of $5,200 a. What is the probability that the outcome will be between $23,400 and $28,6007 Note: Do not round intermediate calculations. Round your answer to 4 decimal places. Probability . What is the probability that the outcome will be between $18,200 and $33,800? Note: Do not round intermediate calculations. Round your answer to 4 decimal place Probability c. What is the probability that the outcome will be at least $20,000? Note: Do not round intermediate calculations. Round your answer to 4 decimal places.. Probability d. What is the probability that the outcome will be less than $41,410? Note: Do not round intermediate calculations. Round your answer to 4 decimal places. Probability When returns from a project can be assumed to be normally distributed, such as those shown in Figure 13-6 (represented by a symmetrical, bell-shaped curve), the areas under the curve can be determined from statistical tables based on standard deviations. For example, 68.26 percent of the distribution will fall within one standard deviation of the expected value ( D= 10). Similarly, 95.44 percent will fall within two standard deviations (D20), and so on. An abbreviated table of areas under the normal curve is shown next Number of a's from Expected Value -and- 0.50 0.1915 0.3830 1.00 0.5415 9.6826 1.15 8.3749 8.7498 1.58 0:4332 0.3664 2.96 0.4985 0.9970 Assume Project A has an expected value of $26,000 and a standard deviation (a) of $5,200 a. What is the probability that the outcome will be between $23,400 and $28,6007 Note: Do not round intermediate calculations. Round your answer to 4 decimal places. Probability . What is the probability that the outcome will be between $18,200 and $33,800? Note: Do not round intermediate calculations. Round your answer to 4 decimal place Probability c. What is the probability that the outcome will be at least $20,000? Note: Do not round intermediate calculations. Round your answer to 4 decimal places.. Probability d. What is the probability that the outcome will be less than $41,410? Note: Do not round intermediate calculations. Round your answer to 4 decimal places. Probability
Expert Answer:
Related Book For
Foundations of Financial Management
ISBN: 978-1259194078
15th edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
Posted Date:
Students also viewed these finance questions
-
Prepayment rates are expected to vary over time for all these reasons except: A . Refinancing due to changing interest rates B . Competing Investment Opportunities C . Debt Reduction D . Sale of Move...
-
When returns from a project can be assumed to be normally distributed, such as those shown in Figure (represented by a symmetrical, bell-shaped curve), the areas under the curve can be determined...
-
In the long run, the selling price of a product should cover ________. Question content area bottom Part 1 A. all fixed costs only B. all variable costs only C. all variable costs and all fixed costs...
-
The total cost of 2 chair and 1 table is 210 dollars. The total cost of 1 chair and 2 tables is 285 dollars. What is the cost of 1 chair?
-
How might managers at different levels of a retail organization define their competition?
-
Find the beginning of the year NAV for a mutual fund that has a current NAV of 15.06 and a YTD% return of 7.9?
-
Consider a risk-neutral bank that lends a total amount L = \($1,000,000\) to the impoverished. The total cost of lending is C = \($200,000,\) the total subsidy from the government to the bank is S =...
-
The following are summary cash transactions that occurred during the year for Hilliard Healthcare Co. (HHC): Cash Received from: Customers ........ $660,000 Interest on note receivables .. 12,000...
-
obabilities can be determined mathematically, empiric coretical, classical, and a priori. Which of the followin An environmentalist believes that there is a 15% cha years. When presented with 10...
-
(c) Assume a company's income statement shows $200m revenue, $130m Operating Costs excluding depreciation, $20m depreciation, $10m interest expense, and a 25% tax rate. What is this company's net...
-
4 . Joe s friend John purchased an automobile for $ 6 0 , 0 0 0 from a dealer for his personal use and has not taken tax depreciation on that automobile. Two years later when the automobile has a...
-
At the end of 2 0 2 3 , accounts receivable for Kopycat Interiors amounted to $ 2 4 9 , 0 0 0 . At the beginning of the year it was $ 1 5 4 , 0 0 0 . Net credit sales for the year amounted to $ 8 2 3...
-
A taxpayer owns three businesses and rental properties in 2 0 X 1 . During the year, the first business, ABC, experienced a $ 3 2 , 0 0 0 loss. The taxpayer participated 2 0 0 hours in ABC, and the...
-
During September, Ferman Clinic budgeted for 3 , 8 1 0 patient - visits, but its actual level of activity was 4 , 1 1 0 patient - visits. The clinic uses the following revenue and cost formulas in...
-
Majority Opinion (Justice Taney) 1. How does Taney rule on the question of Dred Scott's status as a citizen of the United States? What reasoning does he use to support his ruling? 2. How does he rule...
-
When Crossett Corporation was organized in January Year 1 , it immediately issued 4 , 6 0 0 shares of $ 5 3 par, 7 percent, cumulative preferred stock and 8 , 5 0 0 shares of $ 1 4 par common stock....
-
3M Company reports the following financial statement amounts in its 10-K report: a. Compute the receivables, inventory, and PPE turnover ratios for both 2018 and 2017. (Receivables turnover and...
-
The Mission Company Ltd, whose year-end is 31 December, has acquired two items of machinery on leases, the conditions of which are as follows: Item Y: Ten annual instalments of 20,000 each, the first...
-
Peter Mullen says in an article sent in to the ASB, the following: the ASB advocates that all leasing type deals should essentially be accounted for in relation to the extent of asset and liability...
-
(a) When accounting for finance leases, accountants prefer to overlook legal form in favour of commercial substance. Required: Discuss the above statement in the light of the requirements of IAS 17...
Study smarter with the SolutionInn App