CFA Practice Question

There are 434 practice questions for this study session.

CFA Practice Question

Two normal distributions, X and Y, have means of 10% and 15% respectively. What is the mean of the following linear combination: 2X + 3Y?
A. 62.5%
B. 65%
C. 31.3%
Explanation: The linear combination of two normal distributions is also a normal distribution. Its mean = 2 x 10% + 3 x 15% = 65%.

User Contributed Comments 2

User Comment
enetis is this a joke? i spent 5 min trying to figure out if this was a trick question.
edrei7 Multiplications, divisions, additions, and subtractions affect means. But only the first two affect variances.
You need to log in first to add your comment.