I know how to calculate probabilities, but I want to make sure that I am understanding the question.
"What is the probability that the Dow Jones Index will increase by more than 11% in the coming year?"
and
"What is the probability Dow (X) will decrease more than 11% in the coming year?"
Dow Jones follows a Normal Distribution, Mean = 11% and St Dev = 13%
I feel like this is almost too simple.
P(X>11%)= 1-normdist(0.11,0.11,0.13)=50%
P(X<11%)= normdist(0.11,0.11,0.13)=50%
HOWEVER... I was worried maybe it mean 11% above and beyond the mean so P(X>22%) and P(X<0).
I just need clarification.
Thanks so much!
"What is the probability that the Dow Jones Index will increase by more than 11% in the coming year?"
and
"What is the probability Dow (X) will decrease more than 11% in the coming year?"
Dow Jones follows a Normal Distribution, Mean = 11% and St Dev = 13%
I feel like this is almost too simple.
P(X>11%)= 1-normdist(0.11,0.11,0.13)=50%
P(X<11%)= normdist(0.11,0.11,0.13)=50%
HOWEVER... I was worried maybe it mean 11% above and beyond the mean so P(X>22%) and P(X<0).
I just need clarification.
Thanks so much!