The major stock market indexes had strong results in 2018. The mean one-year return for stocks in the S&P 500, a group of 500 very large companies, was -6.24% The mean one- year return for the NASDAGQ, a group of 3,200 small and medium-sized companies, was 2 000/ LIistL.

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Chapter2: The Domestic And International Financial Marketplace
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Finance
The major stock market indexes had strong
results in 2018. The mean one-year return for
stocks in the S&P 500, a group of 500 very
large companies, was -6.24% The mean one-
year return for the NASDAQ, a group of 3,200
small and medium-sized companies, was
-3.88% Historically, the one-year returns are
approximately normally distributed, the
standard deviation in the S&P 500 is
approximately 20%, and the standard
deviation in the NASDAQ is approximately
30%. Repeat (a) through (d) for a stock in the
NASDAQ. f. Write a short summary on your
findings. Be sure to include a discussion of the
risks associated with a large standard
deviation.
Transcribed Image Text:Finance The major stock market indexes had strong results in 2018. The mean one-year return for stocks in the S&P 500, a group of 500 very large companies, was -6.24% The mean one- year return for the NASDAQ, a group of 3,200 small and medium-sized companies, was -3.88% Historically, the one-year returns are approximately normally distributed, the standard deviation in the S&P 500 is approximately 20%, and the standard deviation in the NASDAQ is approximately 30%. Repeat (a) through (d) for a stock in the NASDAQ. f. Write a short summary on your findings. Be sure to include a discussion of the risks associated with a large standard deviation.
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