0.060.04- 0.04 0.06 0.22 0.26 0.26 0.03 0.47 0.06 0.16 0.05 0.18 0.09 0.02 0.19 0.05-0.02 0.08 0.02-0.02 0.13 0.08-0.02 0.07-0.05 0.010.10 0.02 0.06 -0.01 0.03 0.11-0.11 0.09 0.10 0.01 0.25-0.02 0.03
A researcher collected data for the monthly rate of return of a certain
company’s common stock for the past few years. The data is included below.
Choose the correct answer for the interpretation of the
A) All monthly returns within one standard deviation of the mean are contained in the first quartile, all monthly returns within two standard deviations of the mean are contained in the second quartile and all monthly returns within three standard deviations of the mean are
contained in the third quartile.
B) Of the monthly returns, 25% is less than or equal to the first quartile, 50% are less than or equal to the second quartile, and 75% are less than or equal to the third quartile.
C) The first quartile is the lower bound of plausible monthly returns, and the third quartile is the upper bound of plausible monthly returns. Any monthly returns outside of these bounds are outliers. The second quartile represents the most common monthly return.
D) The first quartile is one standard deviation below the mean (or average monthly return), the second quartile is the mean, and the third quartile is one standard deviation above the mean.
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