A security produced returns of 12 percent, -11 percent, -2 percent, 15 percent, and 9 percent over the past five years, respectively.Based on these five years, what is the probability that an investor in this stock will lose more than 17.06 percent in any one given year?

Question

Quizplus · Accepted Answer

The probability of losing more than 17.06 percent in any one given year is 2.50 percent. This is because the security lost more than 17.06 percent in two of the five years, which is 2.50 percent of the time.

A Security Produced Returns of 12 Percent, -11 Percent, -2