QUESTIONS 19 THROUGH 32 RELATE TO QUANTITATIVE METHODS

28.

An analyst wants to estimate the return on the S&P 500 Index for the current year using the

following data and assumptions:



Sample size = 50 securities from the index



Mean return for those stocks in the sample for the previous year = 0.114



Variance = 0.0529



The reliability factor for a 95% confidence interval with unknown population variance

and sample size greater than 30 is

.

If he assumes that the S&P return this year will be the same as it was last year, which of the

following is the best estimate of the 95% confidence interval for this year’s S&P return?

A. –0.11600 to +0.34400

B. +0.05024 to +0.17775

C. +0.06110 to +0.16690