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Mathematics 17 Online
OpenStudy (anonymous):

Anyone out there who enjoys semi-complicated statistics problems, please help! Haven't taken any stat courses since my into stat class and this econometrics problem has me stumped.

OpenStudy (anonymous):

$1 in a stock yeilds Rs, $1 in a bond yeilds Rb Rs is random with a mean .08 and SD of .07 Rb is random with a mean .05 and SD of .04 Correlation of Rs and Rb is .25 If you place a fraction w of your money in the stock fund and the rest, 1-w, in the bond fund, then your return on you investment is R=wRs+(1-w)Rb A. Suppose that w=.5 Compute the mean and SD of R.?? B Suppose that w=.75 Compute the mean and SD of R.?? C What value of w makes the mean of R as large as possible? What is the SD of R for this value of w? D. What us the value of w that minimizes the SD of R??

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