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iThe variance is the average squared difference between which of the following? Actual return and average...

iThe variance is the average squared difference between which of the following? Actual return and average return Actual return and (average return/N - 1) Actual return and the real return Average return and the standard deviation Actual return and the risk-free rate

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Answer #1

Variance is given by

Thus variance is the average squared difference between: Actual return (xi) and average return

Hence, the correct answer is the first option showing: Actual return and average return

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