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Suppose the returns on an asset are normally distributed. The historical average annual return for the asset was 6.6 percent and the standard deviation was 16.5 percent. a. What is the probability that your return on this asset will be less than -8.5 percent in a given year? Use the NORMDIST function in Excel to answer this question. Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. What range of returns would you expect to see 95 percent of the time? Note: Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. c. What range of returns would you expect to see 99 percent of the time? Note: Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. a. Probablility b. 95% level c. 99% level % % % to to % %

Suppose the returns on an asset are normally distributed. The historical average annual return for the asset was 6.6 percent and the standard deviation was 16.5 percent. a. What is the probability that your return on this asset will be less than -8.5 percent in a given year? Use the NORMDIST function in Excel to answer this question. Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. What range of returns would you expect to see 95 percent of the time? Note: Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. c. What range of returns would you expect to see 99 percent of the time? Note: Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. a. Probablility b. 95% level c. 99% level % % % to to % %

Calculus For The Life Sciences
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.CR: Chapter 13 Review
Problem 9CR
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Suppose the returns on an asset are normally distributed. The historical average annual return for the asset was 6.6 percent and the standard deviation was 16.5 percent. a. What is the probability that your return on this asset will be less than -8.5 percent in a given year? Use the NORMDIST function in Excel® to answer this question. Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. What range of returns would you expect to see 95 percent of the time? Note: Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. c. What range of returns would you expect to see 99 percent of the time? Note: Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. a. Probablility b. 95% level c. 99% level % % % to to % %
Transcribed Image Text:Suppose the returns on an asset are normally distributed. The historical average annual return for the asset was 6.6 percent and the standard deviation was 16.5 percent. a. What is the probability that your return on this asset will be less than -8.5 percent in a given year? Use the NORMDIST function in Excel® to answer this question. Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. What range of returns would you expect to see 95 percent of the time? Note: Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. c. What range of returns would you expect to see 99 percent of the time? Note: Enter your answers for the range from lowest to highest. A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. a. Probablility b. 95% level c. 99% level % % % to to % %
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