The price-earnings (PE) ratios of a sample of stocks have a mean value of 12.25 and a standard deviation of 2.7. If the PE ratios have a bell shaped distribution, use the 68-95-99.7 Rule to estimate the percentage of PE ratios that fall between: A. 6.85 and 17.65. Percentage = % B. 4.15 and 20.35. Percentage = % C. 9.55 and 14.95. Percentage = %
Added by Lauren P.
Step 1
For range A (6.85 to 17.65): Lower bound: z = (6.85 - 12.25) / 2.7 = -2 Upper bound: z = (17.65 - 12.25) / 2.7 = 2 Show more…
Show all steps
Close
Your feedback will help us improve your experience
Madhur L and 81 other Intro Stats / AP Statistics educators are ready to help you.
Ask a new question
Labs
Want to see this concept in action?
Explore this concept interactively to see how it behaves as you change inputs.
Key Concepts
Recommended Videos
Suppose your expectations regarding the stock price are as follows: State of the Market Probability Ending Price HPR (including dividends) Boom 0.28 $ 140 49.0% Normal growth 0.22 110 17.0 Recession 0.50 80 -13.5 Use the equations E(r) = Σ p(s) r(s) and σ^2 = Σ p(s) [r(s) - E(r)]^2 to compute the mean and standard deviation of the HPR on stocks. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Mean Standard deviation
Ameer S.
Sri K.
A research analyst wants to compare the dispersion in the price-earnings ratios for a group of common stock with their return on investment. For the price-earnings ratios, the mean is 10.9 and the standard deviation is 1.8. The mean return on investment is 25 percent and the standard deviation 5.2 percent. What is the relative dispersion (also known as coefficient of variation) for the price-earnings ratios and return on investment? Group of answer choices A) Ratios = 32.0 percent, investment =19.0 percent B) Ratios =16.5 percent, investment = 20.8 percent C) Ratios =132.0 percent, investment =190.0 percent D) Ratios = 50.0 percent, investment =10.0 percent
Recommended Textbooks
Elementary Statistics a Step by Step Approach
The Practice of Statistics for AP
Introductory Statistics
Transcript
Watch the video solution with this free unlock.
EMAIL
PASSWORD