Assume the returns from holding small-company stocks are normally distributed. A

Question

Assume the returns from holding small-company stocks are normally distributed. Also assume the average annual return for holding the small-company stocks for a period of time was 15.3 percent and the standard deviation of those stocks for the period was 33.2 percent. Use the NORMDIST function in Excel® to answer the following questions. Requirement 1: What is the approximate probability that your money will double in value in a single year? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) Probability % Requirement 2: What is the approximate probability that your money will triple in value in a single year? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 8 decimal places (e.g., 32.16161616).) Probability %

Explanation / Answer

1) 34.44% 2) 35.55117199%

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