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Unformatted text preview: score can the firm require from their applicants? 6. Consider a portfolio consisting of two assets X and Y. Asset X has a mean return of 4% and a standard deviation of 10. Asset Y has a mean return of 12% and a standard deviation of 15. You have invested 70% of your money in asset X and 30% in asset Y. Assume that Cov(X,Y)=75. Assume both X and Y are normally distributed. a. What is the probability that the portfolios return is positive? b. What is the probability that the portfolio loses at most 5%? c. What is the probability that the portfolios return is between 10% and 20% 7. Assume you have taken a sample of size N=30 with 195 , 30 = and 825 = i 1 2 = N i i X 1 = N i X a. Find the sample mean b. Find the sample variance (hint: expand the formula we know)...
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This note was uploaded on 09/25/2010 for the course ECON 210 taught by Professor Pavan during the Winter '09 term at Northwestern.
 Winter '09
 Pavan

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