A certain financial analyst defines the “volatility” of a stock during a given week to be the result of the following
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B
C
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E
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A. 0.50
B. 1.80
C. 2.00
D. 2.25
E. 2.50
Answer: D
Source: Official Guide
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Absolute difference from Monday to Tuesday = |19 - 21| = 2VJesus12 wrote: ↑Mon Sep 21, 2020 7:12 am2020-04-28_0119.png
A certain financial analyst defines the “volatility” of a stock during a given week to be the result of the following procedure: find the absolute value of the difference in the stock's closing price for each pair of consecutive days in the week and then find the average (arithmetic mean) of these 4 values. What is the volatility of Stock X during the week shown in the table?
A. 0.50
B. 1.80
C. 2.00
D. 2.25
E. 2.50
Answer: D
Source: Official Guide
Absolute difference from Tuesday to Wednesday = |22 - 19| = 3
Absolute difference from Wednesday to Thursday = |24.5 - 22| = 2.5
Absolute difference from Thursday to Friday = |23 - 24.5| = 1.5
Average of the absolute differences = (2 +3 + 2.5 + 1.5)/4 = 9/4 = 2.25
Answer: D