Question

The days maturity for a sample of 5 money market funds areshown here. The dollar amounts invested in the funds areprovided. Use the weighted mean to determine the mean numberof days to maturity for dollars invested in these 5 money marketfunds.COL1 Days tomaturity 20 12 7 5 6COL2 $$ Value (millions) 20 30 10 15 10

Answer 1

Answer:

$\bar X= \frac{20*20 +12*30 +7*10 +5*15 +6*10}{20+30+10+15+10}$

$\bar X = \frac{965}{85}= 11.353$

Step-by-step explanation:

For this case we have the following data:

Days to Maturity       Dollar Value $ Millions)

    20                                     20

    12                                      30

    7                                        10

    5                                        15

    6                                        10

For this case the definition of weigthed mean is given by:

$\bar X = \frac{\sum_{i=1}^n w_i x_i}{\sum_{i=1}^n w_i}$

Where $w_i , i=1,...,n$ represent the weight of each value and $x_i , i=1,...,n$ represent the observations (Days to maturity)

Our interest is the number of days so then our weighting variable would be the dollar Value, so then we can find the weighted mean like this:

$\bar X= \frac{20*20 +12*30 +7*10 +5*15 +6*10}{20+30+10+15+10}$

$\bar X = \frac{965}{85}= 11.353$