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    Probability Distribution

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    The probability distribution of a less risky return is more peaked than that on a riskier return. What shape would the probability distribution have for (a) completely certain returns and (b) completely uncertain returns?

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    Solution Preview

    a) A completely certain return of $x indicates 100% probability concentrated at X = x. Therefore, ...

    Solution Summary

    The probability distribution for a less risky return is determined.

    $2.19

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