Ignoring Twins and Other Multiple Births,assume Babies Born at a Hospital

question 74

Multiple Choice

Ignoring twins and other multiple births,assume babies born at a hospital are independent events with the probability that a baby is a boy and the probability that a baby is a girl both equal to 0.5.Define event B = {at least one of the next two babies is a boy}.What is the probability of the complement of event B?

• A)0.125
• B)0.250
• C)0.375
• D)0.500

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Definitions:

Expected Excess Return

The return on an investment over the risk-free rate of return that is anticipated based on risk assessment.

Beta Coefficient

A measure of a stock's volatility in relation to the overall market; a beta greater than 1 indicates more volatility than the market.

One-Factor APT

A model that describes financial markets and attempts to predict the returns of securities with a single factor, usually related to economic risk.

Standard Deviation

A measure of the dispersion of a set of data from its mean, indicating volatility.