The value of an investment that is found by subtracting the expected value of the project from each possible outcome, squaring each of these values, multiplying each squared deviation by the probability of each respective outcome, and then summing the resulting products is called the:
A) expected value.
B) standard deviation.
C) variance.
D) normal distribution.
E) probability distribution.

Question

Quizplus · Accepted Answer

The process described in the question is the calculation of variance, which measures the dispersion of possible outcomes around the expected value. Therefore, the answer is C, variance.

The Value of an Investment That Is Found by Subtracting