Question

Can you answer Part 2 and 3

Problem 10-24 Using Return Distributions Assume the returns on an asset are normally distributed. Suppose the historical average annual retum for the asset was 4.9 percent and the standard deviation was 10.4 percent What is the probability that your return on this asset will be less than 4.9 percent in a given year? Use the NORMDIST function in Excel® to answer this question. (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g.. 32.16.) Probability 17.30% What range of returns would you expect to see 95 percent of the time? (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.) 95% level ( % to 15.48 % What range would you expect to see 99 percent of the time? (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.) 99% level % to

Answer 1

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STATS - Microsoft Excel (Product Activation Failed) Add-Ins View - 2x Dr General Wrap Text FMerce Merge & Center - Center s $ % % , 4.0 .00 :.: Insert Delete Format File Home Insert Page Layout Formulas Data Review % Cut Calibri 11 AA === Ea Copy Paste B I Format Painter U B- A E E E E Clipboard Font HH7 ac Д GY GZ НА Hв Conditional Format Formatting as Table Styles Cell Styles Σ AutoSum : A Fill Z Sort & Clear Filter Editing Find & Select Alignment Number Cells на HD HE HF HG T Hн н н я EXPECTED RETURN = STANDARD DEVIATION (SD)= 4.9 10.4 PROBABILITY THAT RETURN WILL BE LESS THAN -4.9 ANS PIX<-4.9) = 17.30% (=NORM.DIST(-4.9,4.9,10.4,1)] 13 FORMULA FOR CACCULATING THE RANGE OF RETURNS = EXPECTED RETURN -/+ (Z VALUE)(SD) AT 95% PREDICTION LEVEL Z VALUE = (LOWER VALUE, HIGHER VALUE) (4.9 - (2)(10.4) 4.9+(2)(10.4)) -26.30 (-15.90%, 25.70%) 36.10 14 ANS 3 17 18 19 20 21 22 AT 99% PREDICTION LEVEL Z VALUE = (LOWER VALUE, HIGHER VALUE) (4.9-(3)(10.4) 4.9+ (3)(10.4)) (-26.30%, 36.10%) ANS H P EMV MEAN STDV assignment DEAR Sheet2 COV TIME SERIES corr REGRESSION range CAMERA TREND freg_MATRIX V FV DIVIDEND ferences INTERVAL, NORMAL HYPOTHIC BOU 120% Rea DE I ENG 05:03 22-11-2019