Which of the following is the best definition for the concept of standard deviation?
A) The return earned in an average year over a multi-year period.
B) The hypothesis is that actual capital markets are efficient.
C) The average squared deviation between the actual return and the average return.
D) Statistical measure of maximum loss used by banks and other financial institutions to manage risk exposures.
E) The positive square root of the variance.

Question

Quizplus · Accepted Answer

Standard deviation is a measure of the dispersion or spread of a set of data points. It is calculated as the positive square root of the variance, which is the average squared deviation of each number from the mean of a data set. This makes option E the correct definition of standard deviation.

Which of the Following Is the Best Definition for the Concept