What Percentage of the Time Should You Expect to Earn

question 70

Multiple Choice

What percentage of the time should you expect to earn an annual rate of return that is within two standard deviations of the mean?

• A)100%
• B)95%
• C)68%
• D)99%
• E)75%

Understand the concept of a case of first impression and its impact on legal precedent.

Know the role of finding tools in legal research and their importance in locating primary sources.

Understand the concept of extensive form games and their representation.

Identify and explain strategies in game theory, including dominant strategies and strategies that would not be chosen under any circumstances.

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Definitions:

Risk-Averse

A preference for guaranteed outcomes over gambles, even if the gamble might have a higher expected return due to the dislike of uncertainty.

Risk-Neutral

An attitude towards risk wherein the decision-maker is indifferent between different alternatives with the same expected return, disregarding the level of risk associated with each.

Risk-Loving

Describes individuals or entities that have a preference for taking on risk, often in anticipation of higher returns.

Expected Utility

A theory in economics that predicts the choices individuals will make by considering the risks and benefits of their options and selecting the one which offers the most utility.