Properties of the Normal Distribution Include

question 48

Multiple Choice

Properties of the normal distribution include

• A)a continuous bell-shaped distribution.
• B)a discrete probability distribution.
• C)the number of trials is known and is either 1,2,3,4,5,etc.
• D)the random variable can assume only a finite or limited set of values.
• E)use in queuing.

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Definitions:

Time Premium

The portion of an option's price that exceeds its intrinsic value, representing the extra amount paid for the possibility that the stock’s price will move before expiration.

Minimum Floor Value

The least possible value guaranteed for a specific financial instrument or investment.

Convertible Bond

This bond variant grants the holder the option to exchange it for a fixed amount of the issuer's stock at specific intervals during the bond's duration, typically based on the bondholder's decision.

Straight Bond Value

Straight bond value is the value of a bond that pays fixed interest payments until maturity and repays the principal at maturity without any special features such as convertibility or callability.