If a Payout Is Certain to Occur,then the Variance of That

question 117

Multiple Choice

If a payout is certain to occur,then the variance of that payout equals

• A) zero.
• B) one.
• C) the expected value.
• D) the expected value squared.

---

Definitions:

Corporate Tax Rate

The share of a company's earnings required to be paid to the government as tax.

Straight Line

A method of calculating depreciation of an asset, where the asset's cost is evenly spread over its useful life.

Market Value

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

Unintentionally Biased Estimates

Judgments or projections in financial analysis influenced by unintentional prejudices or statistical biases.