Liberty
University MATH 201 Project 3 solutions answers right
Based on Larson & Farber: sections 5.2–5.3
Go to this website. First, set the date range to be for exactly 1 year ending with
the Monday that this course started. For example, if the current term started
on 04/01/2014, then use 04/01/2013 – 03/31/2014. Your dates will going back
exactly 1 year. Next, click the link on the right that says Download to Spreadsheet and then save
the file to your computer.
This project will only use the Closing Values. Assume that the
closing prices of the stock form a normally distributed data set. This means
that you need to use Excel to find the mean and standard deviation and then use
those numbers and the methods you learned in sections 5.2 and 5.3 of our text
book for Normal distributions to answer the questions.
Complete this assignment within a single Excel file. Show your
work or explain how you obtained each of your answers. Answers with no work and
no explanation will receive no credit.
1. If a person bought 1 share of Google stock within the last year,
what is the probability that the stock on that day closed at less than the mean
for that year? Hint: You do not want to calculate the mean to answer this one.
The probability would be the same for any normal distribution. (5 points)
2. If a person bought one share of Google stock within the last year,
what is the probability that the stock on that day
closed at more than $600? (5 points)
3. If a person bought 1 share of Google stock within the last year,
what is the probability that the stock on that day
closed within $45 of the mean for that year? (5 points)
4. Suppose a person within the last year claimed to have bought
Google stock at closing at $450 per share. Would such a price be considered
unusual? Be sure to use the definition of unusual from our textbook. (5 points)
5. At what prices would Google have to close at in order for it to be
considered statistically unusual? You should have a low and high value. Be sure
to use the definition of unusual from our textbook that is measured as a number
of standard deviations. (5 points)
6. What are Quartile 1, Quartile 2, and Quartile 3 in this data set?
Use Excel to find these values. This is the only question that you should
answer without using anything about the Normal distribution. (5 points)
7. Is the normality assumption that was made at the beginning valid?
Why or why not? Hint: Does this distribution have the properties of a normal
distribution as described in our textbook? It does not need to be perfect. Real
data sets are never perfect. However, it should be close. One option would be
to construct a histogram like we did in Project 1 and see if it has the right
shape. If you go this route, something in the range of 10 to 12 classes would
be a good number. (5 points)
There are also 5 points for miscellaneous items like correct date range, correct
mean, correct SD, etc.
Submit your work through the assignment link by 11:59 p.m. (ET) on
Monday of Module/Week 5. Note that you must do this project on your own—you may
not work with other students. You are always welcome to ask your instructor for
help.
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