The expected rate of return for the coming year on FTC common stock is normally distributed with a mean of 14% and a standard deviation of 7%. Determine the probability of earning more than 21% on FTC common stock.
A) 1.00
B) 0.8413
C) 0.0013
D) 0.1587
(Note: Table V is required to work this problem.)

Question

Quizplus · Accepted Answer

Solution:
z = (21% - 14%) / 7% = 1; From Table V, p = 15.87%

The Expected Rate of Return for the Coming Year on FTC