Problem:
Suppose the returns on an asset are normally distributed. Suppose the historical average annual return for the asset was 5.6 percent and the standard deviation was 10.3 percent.
Required:
Question 1: What range of returns would you expect to see 95 percent of the time?
Question 2: What range would you expect to see 99 percent of the time?
Note: Please provide through step by step calculations.
Note: Please show the work not just the answer.