Time remaining: 00:09:14FinanceYou are choosing between these four investments and you want to be 95% certain that you do notlose more than 8.00% on your investment. Which investments could you choose?Small StocksS&P 500Corporate BondsT-Bills11.71% 6.16%Average returnStandard Deviation of returns39.25%18.04%3.39%3.12%19.76% 6.36%A. All of the investments.B. Corporate Bonds and T-Bills.C. Small Stocks and S&P 500.D. Corporate Bonds and S&P 500.E. T-Bills only.

Calculate the confidence index 95% confidence interval = Return +/- (2*Standard Deviation)

You are choosing between these four investments and you want to be 95% certain that you do not lose more than 8.00% on your investment. Which investments could you choose? Average return Standard Deviation of returns39.25% Small StocksS&P 500Corporate BondsT-Bills 11.71% 6.16% 19.76% 6.36% 18.04% 3.39% 3.12% A. All of the investments. B. Corporate Bonds and T-Bills. C. Small Stocks and S&P 500. D. Corporate Bonds and S&P 500. E. T-Bills only.

You are choosing between these four investments and you want to be 95% certain that you do not lose more than 8.00% on your investment. Which investments could you choose? Average return Standard Deviation of returns39.25% Small StocksS&P 500Corporate BondsT-Bills 11.71% 6.16% 19.76% 6.36% 18.04% 3.39% 3.12% A. All of the investments. B. Corporate Bonds and T-Bills. C. Small Stocks and S&P 500. D. Corporate Bonds and S&P 500. E. T-Bills only.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter8: Risk And Rates Of Return

Section: Chapter Questions

Problem 8PROB

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You are choosing between these four investments and you want to be 95% certain that you do not lose more than 8.00% on your investment. Which investments could you choose? Small Stocks S&P 500 Corporate Bonds T-Bills Average return 18.37% 11.84% 6.47% 3.46% Standard Deviation of returns 38.79% 20.01% 6.98% 3.14% (Select the best choice below.) A. All of the investments. B. Corporate Bonds and S&P 500. C. Small Stocks and S&P 500. D. Corporate Bonds and T-Bills. E. T-Bills only.
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