What Is the Variance of the Returns on a Security

question 7

Multiple Choice

What is the variance of the returns on a security given the following information?
$\begin{array}{lrr}\text { state of the Economy}&\text { Probabllity}&\text { Rate of}\\&\text {of State of Economy}&\text {Return if}\\&&\text {State Occurs}\\\text { Boom } & .20 & 16 \% \\\text { Normal } & .50 & 8 \% \\\text { Recession } & .30 & -8 \%\end{array}$

• A)79.36%
• B)83.35%
• C)87.73%
• D)89.23%
• E)90.98%

Examine the aftermath and global reconfigurations post-World War II.

Understand the basic concepts of simple linear regression, including the regression equation and its components.

Grasp the relationship between the coefficient of determination and the coefficient of correlation.

Learn how to calculate and interpret the mean square error (MSE) and its importance in regression analysis.

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