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In a study of 100 common stocks, it was found that the annual divident rates were normally distributed, with a mean of 4.0% and a standard deviation...

In a study of 100 common stocks, it was found that the annual divident rates were normally distributed, with a mean of 4.0% and a standard deviation of 0.5%. About how many of these stocks paid more than 5%?

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547859_MATH_solution.doc

Since the rates are normally distributed with mean of 4%, then 50 companies (50% of
100) have return rates of 4% or less.
One standard deviation (σ) above the mean (4% + 0.5% = 4.5%) tells us that...

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