{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

# Project Answer - proportion oF “very satisfed” people...

This preview shows pages 1–3. Sign up to view the full content.

STA 103 Fall 2007 Final Project Submitted by: I. H. Dinwoodie December 6, 2007 I have adhered to the Duke Community Standard in completing this assign- ment. 1

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
STA103 Project 2 3 points each, 18 points total 1. Independence in a 4 × 4 Table (a) The fitted values are: Job Satisfaction very little moderately very Income (\$1000) dissatisfied dissatisfied satisfied satisfied < 6 14.2 24.7 72.9 94.2 6-15 19.9 34.6 102.3 132.2 15-25 16.2 28.2 83.2 107.5 > 25 11.8 20.4 60.5 78.2 (b) The χ 2 statistic is 11.99 and the p -value is 0.21 (the area above 11.99 under the χ 2 (9) density). So the table does not contradict the null hypothesis of independence. (c) The largest residual value in absolute value is +13.8, which occurs at “ > 25” Income and “very satisfied.” In other words, the inde- pendence model under predicts the number in this combination, and the population with highest salaries shows a relatively high
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: proportion oF “very satisfed” people. STA103 Project 3 2. Volatility of a Portfolio of Two Stocks (a) One can achieve volatility of 0.0105 in two ways. One can set α = . 89 or α = . 44 and either gives the value 0.0105. These can be read from a good graph or determined numerically. 0.0 0.2 0.4 0.6 0.8 1.0 0.0100 0.0105 0.0110 0.0115 0.0120 0.0125 0.0130 Graph of Portfolio Volatility α Portfolio Volatility (b) The two choices of α give diFerent expected returns. Since IBM has the higher expected return, the better portfolio is the one that puts more weight in IBM, so this gives α = . 89 and a portfolio return of . 00140 = . 89 × . 001402 + . 11 × . 001365. (c) No, the volatility curve does not go as low as 0.010....
View Full Document

{[ snackBarMessage ]}

### What students are saying

• As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

Kiran Temple University Fox School of Business ‘17, Course Hero Intern

• I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

Dana University of Pennsylvania ‘17, Course Hero Intern

• The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

Jill Tulane University ‘16, Course Hero Intern