The Binomial Random Variable X Consists of N = 60

question 93

Short Answer

The binomial random variable x consists of n = 60 trials and has the probability of failure q = 0.4.Using the normal approximation,compute the probability of 45 successes.

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Definitions:

Yield To Maturity

The expected overall profit from a bond when it is kept until the date of its maturity.

Current Yield

The annual income (interest or dividends) earned from an investment, expressed as a percentage of the current price.

Annual Coupon

The fixed interest rate paid by a bond annually to its holder.

Yield To Maturity

The total return anticipated on a bond if it is held until the maturity date, considering both interest payments and capital gains or losses.