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:

Freight

The charge paid for transport of goods, typically either by land, sea, or air.

FOB Destination

A shipping term indicating that the sale is considered complete and the goods owned by the buyer upon arrival at the buyer's location.

Credit Memo

A document issued by a seller to a buyer, reducing the amount owed, typically due to a return or refund.

Debit Delivery Expense

An accounting entry that increases the expense account related to the cost incurred for delivering goods or services.