An asset had annual returns of 12,18,6,-9,and 5 percent,respectively,for the last five years.What is the variance of these returns?
A) 0.00810
B) 0.01013
C) 0.01065
D) 0.02038
E) 0.04052

Question

Quizplus · Accepted Answer

Mean = (0.12 + 0.18 + 0.06 - 0.09 + 0.05) / 5 = 0.064 Var = [(0.12 - 0.064)² + (0.18 - 0.064)² + (0.06 - 0.064)² + (-0.09 - 0.064)² + (0.05 - 0.064)²] / (5 - 1) = 0.01013

An Asset Had Annual Returns of 12,18,6,-9,and 5 Percent,respectively,for the Last