Standard and Poor 500 (S&P500) is an index of 500 large corporations capitalization on the NYSE. The annual rate of return of the index is approximately normal. From January 1, 1960 to December 31, 2019, the S&P 500 had an average annual return of 10.98%, with a deviation standard of approximately 17.46%. Consider this normal distribution to be the distribution of annual returns over a long period. (a) In what mean interval do 95% of the annual returns fall? (95% center) (b) Stock prices can go up or down. What are the yields of 2.5% lower?

Standard and Poor 500 (S&P500) is an index of 500 large corporations capitalization on the NYSE. The annual rate of return of the index is approximately normal. From January 1, 1960 to December 31, 2019, the S&P 500 had an average annual return of 10.98%, with a deviation standard of approximately 17.46%. Consider this normal distribution to be the distribution of annual returns over a long period. (a) In what mean interval do 95% of the annual returns fall? (95% center) (b) Stock prices can go up or down. What are the yields of 2.5% lower?

Calculus For The Life Sciences

2nd Edition

ISBN:9780321964038

Author:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.

Publisher:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.

Chapter13: Probability And Calculus

Section13.3: Special Probability Density Functions

Problem 36E

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