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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. 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 $525? (5 points)If a person bought one share of Google stock within the last year, the probability that the stock on that day closed at more than $525 is about 0.
8580 (or 85.8%).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 $15 of the mean for that year?If a person bought 1 share of Google stock within the last year, the probability that the stock on that day closed within $15 of the mean for that year is about 0.4714 (or 47.14%).4. Suppose a person within the last year claimed to have bought Google stock at closing at $589.50 per share. Would such a price be considered unusual?
Be sure to use the definition of unusual from our textbook. No, such a price would not be considered unusual. This is because the probability of buying a Google stock at closing at $589.50 (or higher) is about 0.0507 (or 5.07%) and typically, we say that an event with a probability less than 5% is unusual. However, we can say that it is very close to being considered an unusual price.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.
(5 points)Typically, we say that an event with a probability of less than 5% is unusual. Therefore, dividing unusual probability (5%) in both the left and right tails equally.At prices below or equal to $503.85 (low value) or above or equal to $597.15 Google would have to close at in order for it to be considered statistically unusual.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 Normal distribution.
(5 points)The Quartile 1, Quartile 2, and Quartile 3 in this data set are $533.80, $548.62 and $571.41, respectively.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)Yes, the normality assumption that was made at the beginning is valid. This is because the histogram of the closing prices of Google stock is approximately normal. Furthermore, the mean ($550.50) and the median, Q2 ($548.62) closing prices are approximately the same.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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