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Mohammad Ali
Mohammad Ali, Accounts & Financial Advisor
Category: Finance
Satisfied Customers: 370
Experience:  Qualified Cost & Management Accountant, with 2 years experience in Financial & Audit Services
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the probability distribution of a less risky return is more

Customer Question

the probability distribution of a less risky return is more peaked than that of a riskier return. What shape would hte probability distribution have for (a) completely certain returns and (b) completely uncertain returns?
Submitted: 7 years ago.
Category: Finance
Expert:  Mohammad Ali replied 7 years ago.

The probability distribution curve for a completely certain return would be a straight line, since there is no variability in the returns. The shape of the probability distribution curve for a set of completely uncertain return would be a horizontal line, since there is infinite variability of returns.