Aquarius Inc.has posted the following annual returns for the past 5 years: 17%, 23%, -13%, 7%, and -15%.What are the variance and standard deviation of these annual returns?
A)Variance = 0.00237; standard deviation = 0.04868
B)Variance = 0.06221; standard deviation = 0.2494
C)Variance = 0.02972; standard deviation = 0.1724
D)Variance = 0.2341; standard deviation = 0.4838

Question

Quizplus · Accepted Answer

To calculate variance, find the mean of the returns, subtract the mean from each return, square the result, sum these squares, and divide by the number of returns. The standard deviation is the square root of the variance.