A Stockbroker Has Kept a Daily Record of the Value

question 50

Multiple Choice

A stockbroker has kept a daily record of the value of a particular stock over the years and finds that prices of the stock form a normal distribution with a mean of $8.52 with a standard deviation of $2.38. What percentage of the distribution lies between $5 and $11?

• A) 21.48%
• B) 78.41%
• C) 49.41%
• D) 57.98%

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Definitions:

Market Value

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

Equity

The value of an ownership interest in a company, calculated as the company's assets minus its liabilities.

Debt

An amount of money borrowed by one party from another, usually with the condition of repayment with interest.

Put Contract

A financial contract granting the owner the privilege to sell a certain asset at a predetermined price during a set period.