For Log Normally Distributed Returns, Annual Compound Returns Equal

question 82

Multiple Choice

For log normally distributed returns, annual compound returns equal

• A)the arithmetic average return minus half the variance.
• B)the arithmetic average return plus half the variance.
• C)the arithmetic average return minus half the standard deviation.
• D)the arithmetic average return plus half the standard deviation.

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Definitions:

Gate-Control Theory

A theory that suggests the presence of a neurological "gate" in the spinal cord that controls the transmission of pain signals to the brain.

Pain Signals

Biological signals that indicate distress or damage to the body, prompting a reaction to alleviate or remove the source of discomfort.

Basic Tastes

The primary sensory experiences of human taste perception, traditionally classified as sweet, sour, salty, bitter, and umami.

Umami

Umami is one of the five basic tastes, alongside sweet, sour, bitter, and salty, and is characterized by a savory flavor found in foods like tomatoes, cheese, and soy sauce.