Compute the Mean and Standard Deviation of a Binomial Random

question 28

Multiple Choice

Compute the Mean and Standard Deviation of a Binomial Random Variable
-A quiz consists of 930 true or false questions. If the student guesses on each question, what is the standard deviation of the number of correct answers

• A) 15.2479507
• B) 0
• C) 2
• D) 21.5638587

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Definitions:

Call Option Contract

A financial contract that gives the buyer the right, but not the obligation, to buy an asset at a specified price within a specific timeframe.

Underlying Asset

The financial asset upon which a derivative instrument, such as an option or a futures contract, is based.

Floating-Rate Debt

Floating-rate debt is a type of loan or security that has a variable interest rate, which adjusts periodically based on a benchmark or index rate.

Market Value

The current price at which an asset or service can be bought or sold in a public market.