Over a number of years, the average annual rate of return for Fidelity's Contra mutual fund has been .11 with a standard deviation of .23.Assume annual returns are approximately normally distributed around the average rate.Using this historical information as the basis for the calculations, there is a 50% probability that this fund will have a rate of return between .05 and what value.
A).402
B).358
C).290
D).382
E).394

Question

Quizplus · Accepted Answer

The correct answer is A because the standard deviation is .23 and the average annual rate of return is .11. The probability of a return between .05 and .402 is 50%.

Over a Number of Years, the Average Annual Rate of Return