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Consider an Investment with the Following Payoffs and Probabilities $\sigma$ = $\surd$

Question 14

Multiple Choice

Consider an investment with the following payoffs and probabilities: $Consider an investment with the following payoffs and probabilities: Let the expected value in this example be 1,300.How do we find the standard deviation of the investment? A) \sigma = \surd { (1000-1300) 2 + (2000-1300) 2 } B) \sigma = \surd { (1000-1300) + (2000-1300) } C) \sigma = \surd { (.5) (1000-1300) 2 + (.5) (2000-1300) 2 } D) \sigma = \surd { (.7) (1000-1300) + (.3) (2000-1300) } E) \sigma = \surd { (.7) (1000-1300) 2 + (.3) (2000-1300) 2 }$
Let the expected value in this example be 1,300.How do we find the standard deviation of the investment?

A) $\sigma$ = $\surd$ { (1000-1300) ² + (2000-1300) ² }
B) $\sigma$ = $\surd$ { (1000-1300) + (2000-1300) }
C) $\sigma$ = $\surd$ { (.5) (1000-1300) ² + (.5) (2000-1300) ² }
D) $\sigma$ = $\surd$ { (.7) (1000-1300) + (.3) (2000-1300) }
E) $\sigma$ = $\surd$ { (.7) (1000-1300) ² + (.3) (2000-1300) ² }