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Problem 5-10 The continuously compounded annual return on a stock is normally distributed with a mean of 14% and standard dev
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Answer #1

Answer is -46.0% and 74.0%

Mean = 14.00%
Standard Deviation = 30.00%

95.44% Confidence Interval = [Mean - 2 * Standard Deviation, Mean + 2 * Standard Deviation]
95.44% Confidence Interval = [14.00% - 2 * 30.00%, 14.00% + 2 * 30.00%]
95.44% Confidence Interval = [14.00% - 60.00%, 14.00% + 60.00%]
95.44% Confidence Interval = [-46.00%, 74.00%]

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