Use the Information for the Question(s)below

question 2

Multiple Choice

Use the information for the question(s) below.
Consider an economy with two types of firms,S and I.S firms always move together,but I firms move independently of each other.For both types of firm there is a 70% probability that the firm will have a 20% return and a 30% probability that the firm will have a -30% return.
-The standard deviation for the return on an individual firm is closest to:

• A)23.0%.
• B)5.25%.
• C)15.0%.
• D)10.0%.

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Definitions:

Capacity Planning

The process of determining the production capacity needed by an organization to meet changing demands for its products.

Materials Planning

The systematic determination of required materials and components, including quantity and timing to support production.

Core Function

The primary and essential activities that a business or system is designed to perform.