Exhibit 11-2

question 38

Multiple Choice

Exhibit 11-2.The manager of a video library would like the variance of the waiting times of the customers not to exceed 2.30 minutes-squared.He would like to add an additional billing counter if the variance exceeds the cut-off.He checks the recent sample data.For a random sample of 24 customer waiting times,he arrives at a sample variance of 3.8 minutes-squared.The manager assumes the waiting times to be normally distributed. Refer to Exhibit 11-2.Approximate the p-value.

• A)p-value lies between 0.005 and 0.010
• B)p-value lies between 0.010 and 0.025
• C)p-value lies between 0.050 and 0.10
• D)p-value lies between 0.025 and 0.05

---

Definitions:

Black-Scholes

A mathematical model used for pricing European style options and understanding the dynamics of options markets.

Standard Deviation

Standard Deviation is a statistical measurement that represents the degree of variation or dispersion from the average, often used to quantify the risk of investment returns.

Market Call Premium

Additional amount above the par value that an investor must pay to call in a callable bond before its maturity date.

Stock Price Volatility

Refers to the degree of variation of a trading price series over time as measured by the standard deviation of logarithmic returns.