A portfolio has a current value of $1000.The annual profit $X$ is distributed normally with mean 100 and standard deviation 100.What is the probability that the portfolio will be worth less than 800 after one year?
A)0.0014
B)0.0062
C)0.0228
D)0.1587

Question

Quizplus · Accepted Answer

The probability that the portfolio will be worth less than 800 after one year is the area under the normal distribution curve to the left of 800. The z-score for 800 is (800 - 100) / 100 = -2. The area under the normal distribution curve to the left of -2 is 0.0228.

A Portfolio Has a Current Value of $1000 XXX Is Distributed Normally with Mean 100 and Standard Deviation 100

A Portfolio Has a Current Value of $1000 $X$ Is Distributed Normally with Mean 100 and Standard Deviation 100