Assume That the Average Annual Historical Return for Shares That

question 75

Multiple Choice

Assume that the average annual historical return for shares that comprise the Australian All Ordinaries index is 12%, and the standard deviation of returns is 20%. Based on these numbers what is a 95% prediction interval for 2012 returns?

• A) -10%,40%
• B) -15%, 35%
• C) -20%,35%
• D) -28%, 52%

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Definitions:

Capitalism

An economic system based on private ownership of the means of production and their operation for profit.

Human Capital Theory

A theory in economics that views individuals' skills and education as a form of capital and suggests that investments in education and training enhance productivity and earnings.

Dual Labor Market Theory

A theory that suggests the economy is divided into two segments: the primary sector with good jobs and high wages, and the secondary sector with poor jobs and low wages.

Gender Gap

The differences in opportunities, status, attitudes, and conditions for men and women in various aspects of society, including employment and education.