Mega Corporation has the following returns for the past three years: 8%, 12% and 10%. Calculate the variance of the return and the standard deviation of the returns.
A) 64 and 8%
B) 124 and 11.1%
C) 4 and 2%
D) None of the above

Question

Quizplus · Accepted Answer

The average return is 10%. The variance is calculated as the average of squared deviations from the mean: [(8-10)^2 + (12-10)^2 + (10-10)^2] / 3 = 4. The standard deviation is the square root of the variance, which is 2%.

Mega Corporation Has the Following Returns for the Past Three