value 1.00 points The price of shares of the Continental Bank at the end of trad

Question

value 1.00 points The price of shares of the Continental Bank at the end of trading each day for the last year followed the normal distribution. Assume there were 240 trading days in the year. The mean price was $42.00 per share and the standard deviation was $2.25 per share. Refer to the table in Appendix B.1. (Round the final answers to 2 decimal places.) a-1. What percentage of the days was the price over $45.00? Percentage of days 9.18 % a-2. How many days would you estimate? Number of days b. What percentage of the days was the price between $38.00 and $40.00? Percentage of days 14.92 % c. What was the minimum price of the stock on the highest 15 days of the year? Stocks price

Explanation / Answer

1) Solution: 9.18%

Working: z = (45 -42) /2.25 = 1.33,

p ( z > 1.33) = 0.5000 - 0.4082 = 0.0918 or 9.18%

2) Solution: 22 days

Working: It is over $45 nearly 22 days (=240 * 0.0918)

3) Solution: 14.92%

Working: z = (38 -42)/2.25 = -1.78 and z = (40 - 42)/2.25 = -0.89.

Thus, 0.4625 - 0.3133 = 0.1492 or 14.92%

4) Solution: $44.34

Working: 42.00 + (1.04 * 2.25)

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