Which is the best investment company to invest in: Investment Company A Possible Return 55 pesos 45 pesos Probability 0.5 0.5 Investment Company B Possible Return 60 pesos 40 pesos Probability 0.5 0.5 Investment Company C Possible Return 0 pesos 50 pesos 100 pesos Probability 0.3 0.4 0.3 Using the concept of variance of discrete random variables, which of three best options has the best deal? Explain your answer.

MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
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Use the concept of variance of discrete random variables. Please show complete solution

Which is the best investment company to invest in:
Investment Company A
Possible Return
55 pesos
45 pesos
Probability
0.5
0.5
Investment Company B
Probability
0.5
Possible Return
60 pesos
40 pesos
0.5
Investment Company C
Possible Return
Probability
O pesos
50 pesos
100 pesos
0.3
0.4
0.3
Using the concept of variance of discrete random variables, which of three best options has the best deal?
Explain your answer.
Transcribed Image Text:Which is the best investment company to invest in: Investment Company A Possible Return 55 pesos 45 pesos Probability 0.5 0.5 Investment Company B Probability 0.5 Possible Return 60 pesos 40 pesos 0.5 Investment Company C Possible Return Probability O pesos 50 pesos 100 pesos 0.3 0.4 0.3 Using the concept of variance of discrete random variables, which of three best options has the best deal? Explain your answer.
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