Assume that the returns from an asset are normally distributed. The average annu

Question

Assume that the returns from an asset are normally distributed. The average annual return for this asset over a specific period was 17 percent and the standard deviation of those returns in this period was 43.68 percent What is the approximate probability that your money will double in value in a single year? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g.. 32.16.) Probability of doubling 2 87 percentage What about triple in value? (Do not round intermediate calculations. Enter your answer as a percent rounded to 6 decimal places, e.g., 32.161616.) Probablity of tripling percentage

Explanation / Answer

Ans:

= 43.68 / 17%

= 2.56%

Probability of doubling:

= 2.87%

Probability of tripling:

23.639903%

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