Your Uncle Mike Is Approaching Retirement and He Asks for Your

question 363

Multiple Choice

Your Uncle Mike is approaching retirement and he asks for your advice for a safe place to invest several thousand dollars. He wants to receive some kind of payment each year for investing his money without a great deal of risk. You explain

• A) Yankee bonds are certain not to default.
• B) common stock always pays quarterly dividends.
• C) junk bonds do not pay annual interest.
• D) treasury and top-grade corporate bonds pay interest two times each year.

---

Definitions:

Standard Normal

A standard normal distribution characterized by a mean value of zero and a standard deviation measuring one.

Area

The measure of the extent of a two-dimensional figure or shape in a plane.

Normal Probability

Describes the likelihood of an event occurring under a normal distribution, characterized by a symmetrical, bell-shaped curve.

Poisson Distribution

A discrete probability distribution that expresses the probability of a given number of events occurring in a fixed interval of time or space, given a known constant rate of occurrence.