Question

1.​Draw a normal curve distribution for stocks that have an expected return of 10% and a standard deviation of 20%. Show the values for plus one and minus one standard deviation points

Answer 1

Steps:

1. Enter Expected Return of 10% in cell F1

2. Enter Standard Deviation of 20% in Cell F2

3. Type -1 in Cell A1

4. Use the function NORMDIST(A1,$F$1,$F$2,0) in Cell B1

5. Cell A2 = A1+0.01

6. Select A1 and B1 and drag down until row 201

7. Select the entire data from A1 B1 to A201 B201 and insert Scatter Plot with Smooth Lines

8. 1 Standard Deviation away from mean is 33.33% of data points to the right and 33.33% of data points to the left

9. Mean of 10% is at data point 111. 110 * 1/3 = 37 points to the left and 37 points to the right from the 111th data point (mean)