Scenario 5.4: Suppose an Individual Is Considering an Investment in Which There

question 86

Multiple Choice

Scenario 5.4:
Suppose an individual is considering an investment in which there are exactly three possible outcomes, whose probabilities and payoffs are given below:
The expected value of the investment is $25. Although all the information is correct, information is missing.
-Refer to Scenario 5.4. What is the standard deviation of the investment?

• A) 0
• B) 16.58
• C) 56.12
• D) 90.14
• E) none of the above

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Definitions:

Additive Manufacturing

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Devices designed to produce energy through nuclear fusion, a process where light atomic nuclei combine to form heavier nuclei, releasing energy in the process.

Anti-Gravitational Fields

Hypothetical phenomena or technology that would counteract the force of gravity, often discussed in the context of science fiction or theoretical physics.

Variable Costs

Costs that change in proportion to the level of activity or volume of output in a business.