The S & P 500 is a collection of 500 stocks of publicly traded companies. Using data obtained from Yahoo!Finance, the monthly rates of return of the S & P 500 from 1950 through 2015 are normally distributed. The mean rate of return is 0.007443 and the standard deviation is 0.04135.
What is the probability that a randomly selected month has a positive rate of return? That is, what is P(X > 0)?
What is the probability that the mean monthly return for a five year period is positive? That is, for n = 60 months, what is P(the sample mean (x-bar) > 0)?
a. |
0.16 |
|
b. |
0.08 |
|
c. |
0.50 |
|
d. |
0.92 |
|
e. |
0.84 |
Get Answers For Free
Most questions answered within 1 hours.