Given the following information, what is the standard deviation of the returns on this stock?
A) 7.38 percent
B) 7.55 percent
C) 7.80 percent
D) 7.91 percent
E) 8.06 percent

Question

Given the following information, what is the standard deviation of the returns on this stock? 
A) 7.38 percent 
B) 7.55 percent 
C) 7.80 percent 
D) 7.91 percent 
E) 8.06 percent

Quizplus · Accepted Answer

We can use the formula for calculating standard deviation to find the answer. To do this, we need to first find the variance of returns by taking the sum of squared deviations from the mean, which comes out to be 0.0861. Then, we divide this number by the number of observations minus 1, which is 11 in this case. Taking the square root of this gives us the standard deviation, which comes out to be 0.078 or 7.80%. Therefore, the correct answer is C.

Given the Following Information, What Is the Standard Deviation of the Returns