A Stock Has an Average Return of 18

question 72

Multiple Choice

A stock has an average return of 18.2 percent and a standard deviation of 10.7 percent. In any one given year, you have a 95 percent chance that you will not lose more than _____ percent nor earn more than ____ percent if you invest in this security.

• A) -3.2 percent to 28.9 percent
• B) -3.2 percent to 39.6 percent
• C) -13.9 percent to 28.9 percent
• D) -13.9 percent to 39.6 percent
• E) -13.9 percent to 50.3 percent

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Definitions:

FOB Destination

A shipping term indicating that the seller bears freight charges and owns the goods until they are delivered to the buyer’s location.

Freight Charges

Costs associated with transporting goods from one place to another.

FOB Destination

A shipping term indicating that the seller pays for transportation and is responsible for the goods until they are received by the buyer.

FOB Shipping Point

A term indicating that the buyer assumes responsibility for the goods and the transportation costs at the point of origin.