A Uniform Probability Distribution Is a Continuous Probability Distribution Where

question 23

Multiple Choice

A uniform probability distribution is a continuous probability distribution where the probability that the random variable assumes a value in any interval of equal length is _____.

• A) different for each interval
• B) the same for each interval
• C) either different or the same depending on the magnitude of the standard deviation
• D) None of the answers is correct.

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Definitions:

Profitability Index

A financial metric used to measure the relative profitability of an investment, calculated as the present value of future cash flows divided by the initial investment.

Discount Rate

The discount rate utilized in determining the present value of future cash flows through discounted cash flow (DCF) analysis.

NPV

Net Present Value, a method used in capital budgeting to evaluate the profitability of an investment by calculating the present value of expected cash flows minus the initial cost.

Discount Rate

The interest rate used in discounted cash flow analysis to determine the present value of future cash flows.