The following table summarizes investment outcomes and corresponding probabilities for a particular oil well: X= the outcome
Question:
The following table summarizes investment outcomes and corresponding probabilities for a particular oil well:
X= the outcome in $ p(x)
-$ 40,000 (no oil)........... .25
10,000 (some oil) ........... .7
70,000 (much oil) ........... .05
a. Graph p( x); that is, graph the probability distribution of x.
b. Find the expected monetary outcome. Mark this value on your graph of part a. Then interpret this value.
c. Calculate the standard deviation of x.
DistributionThe word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most...
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a Probabilities of investment outcomes for an oil well b x px 40000025 10000070 70000005 ...View the full answer
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Related Book For 
Essentials Of Business Statistics
ISBN: 9780078020537
5th Edition
Authors: Bruce Bowerman, Richard Connell, Emily Murphree, Burdeane Or
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