Explore BrainMass

Explore BrainMass

    Normal Distribution, Time Value of Money

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    1.Consider the normal distributions drawn below (with different scales)

    They both have m = 20 and the area of the shaded region of each is 0.90. Which of the following holds?
    a. x1 < x2
    b. x1 > x2
    c. x1 = x2
    d. There is not enough information
    e. x1 >= x2

    2.If you deposit $5000 into a fund paying 6% interest compounded quarterly, how much can you withdraw at the end of each quarter for 5 years?
    a. $135.92
    b. $970.45
    c. $291.23
    d. $215.17
    e. none of the above

    Please see the attached file for full problem description.

    © BrainMass Inc. brainmass.com March 4, 2021, 6:11 pm ad1c9bdddf
    https://brainmass.com/statistics/normal-distribution/normal-distribution-time-value-of-money-33826

    Attachments

    Solution Preview

    1.Consider the normal distributions drawn below (with different scales)

    They both have m = 20 and the area of the shaded region of each is 0.90. Which of the following holds?
    a. x1 < x2
    b. x1 > x2
    c. x1 = x2
    d. There is not enough information
    e. x1 >= x2

    Answer: a. x1 < x2

    The standard deviation for b) s= 8 is greater than that of a) s= 5.
    This means that the spread around the mean is more for b) than for a)
    Thus ...

    Solution Summary

    Answers Multiple choice questions on Normal Distribution, Time Value of Money.

    $2.49

    ADVERTISEMENT