Question

A firm believes the internal rate of return for its proposed investment can best be described...

A firm believes the internal rate of return for its proposed investment can best be described by a normal distribution with mean 45% and standard deviation 4%.

a) What is the probability that the internal rate of return for the investment will be between 41% and 49%?

b) What is the probability that the internal rate of return for the investment will be more than 41%?

c) What is the probability that the internal rate of return for the investment will be less than 33%? Use the Excel templet for this part.

d) What is the probability that the internal rate of return for the investment will be more than 33%? Use the Excel templet for this part.

e) Draw the distribution (the bill shaped curve) express the problem in the original units (X) and in standardized units (Z)

Normal Probabilities
Common Data
Mean 45
SD 4
Probability for X <=
X Value
Z Value
P(X<=33)
Probability for X >
X Value
Z Value
P(X>33)
Math   Statistics-And-Probability   
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Homework Answers

Answer #1

Normal Probabilities
Common Data
Mean 45
SD 4
Probability for X <=
X Value 33
Z Value -3
P(X<=33) 0.0013
Probability for X >
X Value 33
Z Value -3
P(X>33) 0.9987
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