If the returns on a share index can be characterised by a normal distribution with mean 12%, the probability that returns will be lower than 12% over the next period equals
A)25%.
B)46%.
C)33%.
D)50%.

Question

Quizplus · Accepted Answer

In a normal distribution, the mean divides the distribution into two equal halves. Therefore, the probability of returns being lower than the mean (12%) is 50%.

If the Returns on a Share Index Can Be Characterised