In a Normal Distribution, _____ of the Observations Fall Within

question 21

Multiple Choice

In a normal distribution, _____ of the observations fall within one standard deviation of the mean.

• A) 31.7%
• B) 68.3%
• C) 95.5%
• D) 98.3%
• E) 99.7%

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Definitions:

Net Present Value

A calculation that evaluates an investment's profitability by discounting expected future cash flows to their present value and subtracting the initial investment.

Cash Inflows

Funds received by a business from its operational activities, investments, or financing, contributing to its cash pool.

Time Value of Money

The belief that possessing money in the present is worth more than holding the same amount later on because it has the potential to increase in value.

Capital Budgeting Methods

Techniques used by companies to evaluate the desirability of investments or expenditures. Major methods include net present value (NPV), internal rate of return (IRR), and payback period.