If the Returns on a Stock Index Can Be Characterized

question 40

Multiple Choice

If the returns on a stock index can be characterized by a normal distribution with mean 12%, the probability that returns will be lower than 12% over the next period equals ________.

• A) 50%
• B) 25%
• C) 46%
• D) 33%

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Definitions:

Variable

An element, feature, or factor that is liable to vary or change.

Closed Sentence

A statement or equation that contains no variables and is either true or false.

Variable

A component, attribute, or aspect that is subject to change or variation.

Quantity

The amount or number of material or immaterial things.