SCENARIO 6-4 According to Investment Digest, the Arithmetic Mean of the Annual

question 99

Short Answer

SCENARIO 6-4
According to Investment Digest, the arithmetic mean of the annual return for common stocks over an
85-year period was 9.5% but the value of the variance was not mentioned.Also 25% of the annual returns were below 8% while 65% of the annual returns were between 8% and 11.5%.The article claimed that the distribution of annual return for common stocks was bell-shaped and approximately symmetric.Assume that this distribution is normal with the mean given above.Answer the following questions without the help of a calculator, statistical software or statistical table.
-Referring to Scenario 6-4, 10% of the annual returns will be less than what amount?

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Definitions:

Type A Personality

Type A personality describes individuals who are highly competitive, self-driven, goal-oriented, and can exhibit aggressive behavior under stress.

Stress Experienced

The physical or emotional response that individuals undergo when they perceive a discrepancy between the demands placed on them and their ability to meet those demands.

Anger

Anger is an emotional state characterized by feelings of annoyance, displeasure, or hostility towards someone or something.

Hostility

Aggressive behavior or attitudes towards others, often stemming from anger, resentment, or opposition.