Question

While researching different companies, she discovers the following standard deviations of one year of daily stock closing prices.
Masterful Pocket Watches: Standard deviation of stock prices =$9.83
Eye Remember Enterprises: Standard deviation of stock prices =$1.15

Based on the data and assuming these trends continue, which company would give Donna a stable long-term investment?

a} eye remember enterprises; the smaller deviation indicates that eye enterprises have less variability in its closing prices than masterful pocket watches.

b}masterful pocket watches; the larger standard deviation indicates that masterful pocket watches have less variability in its closing prices than eye remember enterprises.

c} eye remember the enterprises; the smaller standard deviation indicates that eye remember enterprises has a greater mean closing price than masterful pocket watches.

d}masterful pocket watches; the larger standard deviation indicates that masterful pocket watches have a greater mean closing price than eye remember enterprises.

Answer 1

The data and assuming shows that the company that would give Donna a stable long-term investment is A. eye remember enterprises; the smaller deviation indicates that eye enterprises have less variability in its closing prices than masterful pocket watches.

How to illustrate the information?

It should be noted that the information given implies that Donna needs a stable long term investment.

In this case, it's appropriate that the company that has the less standard deviation should be chosen.

This illustrates that Perfect Plungers has less variability.

In conclusion, the correct option is A.

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