# Question 1 4 points According to Investment Digest...

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Question 1 (4 points) According to Investment Digest ("Diversification and the Risk/Reward Relationship", Winter 1994, 1-3), the mean of the annual return for common stocks from 1926 to 1992 was 16.5%, and the standard deviation of the annual return was 19%. In later parts of the question we will ask: a. What is the probability that the stock returns are greater than 0%? b. What is the probability that the stock returns are less than 18%? For this part, answer the following question: Which table will we use to find the area under the normal curve? Question 1 options: F-Table Z-Table K-Table T-Table
Save Question 2 (7 points) According to Investment Digest ("Diversification and the Risk/Reward Relationship", Winter 1994, 1-3), the mean of the annual return for common stocks from 1926 to 1992 was 16.5%, and the standard deviation of the annual return was 19%. In later parts of the question we will ask:
For this part, answer the following question: What is the value of the test statistic (Z, t, or F) for each part? (Round to 2 decimal digits)
-0.87 in part a, -0.06 in part b -0.67 in part a, 0.06 in part b -0.87 in part a, 0.08 in part b 0.67 in part a, 0.08 in part b Save Question 3 (7 points) According to Investment Digest ("Diversification and the Risk/Reward Relationship", Winter 1994, 1-3), the mean of the annual return for common stocks from 1926 to 1992 was 16.5%, and the standard deviation of the annual return was 19%. In later parts of the question we will ask:
For this part, answer the following question: What is the area between the mean and our actual score? Question 3 options: 0.408 in part a, 0.039 in part b 0.308 in part a, 0.032 in part b 0.408 in part a, 0.319 in part b 0.308 in part a, 0.039 in part b
Save Question 4 (7 points) According to Investment Digest ("Diversification and the Risk/Reward Relationship", Winter 1994, 1-3), the mean of the annual return for common stocks from 1926 to 1992 was 16.5%, and the standard deviation of the annual return was 19%. a. What is the probability that the stock returns are greater than 0%?