An Asset Has an Average Annual Historical Return of 11

question 4

Multiple Choice

An asset has an average annual historical return of 11.6 percent and a standard deviation of 17.8 percent. What range of returns would you expect to see 95 percent of the time?

• A)−41.8% to + 65.0%
• B)−34.4% to + 53.6%
• C)−24.0% to + 47.2%
• D)−6.2% to + 29.4%
• E)−5.4% to + 41.0%

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Definitions:

Indirect Cost

A cost that cannot be easily and conveniently traced to a specified cost object.

Factory Supervisor

An individual responsible for overseeing the production processes and workers within a manufacturing facility.

Direct Cost

A cost that can be easily and conveniently traced to a specified cost object.

Prime Cost

Direct materials cost plus direct labor cost.