The Average Annual Return Over the Period 1886-2006 for Stocks

question 24

Multiple Choice

The average annual return over the period 1886-2006 for stocks that comprise the S&P 500 is 10.5%,and the standard deviation of returns is 18.5%.Based on these numbers what is a 95% confidence interval for 2007 returns?

• A)-18.5%,18.5%
• B)-10%,10%
• C)-26.5%,47.5%
• D)-37%,37%

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Definitions:

Tolerance

A physiological adaptation in which exposure to a drug or stimulus over time leads to a reduced reaction, necessitating larger doses to achieve the same effect.

Cocaine

A powerful stimulant drug derived from the coca plant, which can lead to serious health issues, dependency, and addiction.

Substance Withdrawal

Symptoms that occur upon the reduction or cessation of intake of addictive substances to which one has become dependent, often leading to significant distress or impairment.

Cocaine

A powerful and addictive stimulant drug extracted from the leaves of the coca plant, which increases levels of dopamine in the brain circuits regulating pleasure and movement.