- CFA Exams
- CFA Level I Exam
- Study Session 2. Quantitative Methods (1)
- Reading 8. Probability Concepts
- Subject 1. Introduction
CFA Practice Question
An experiment consists of observing the total rate of return for the stocks in a portfolio for 2014. Let Y be the percentage total return rate for a stock. Let event A be the event that the total return rate for a stock in 2014 be greater than 1%. What is the sample space for this experiment?
A. S = {y|y>1}
B. S = {y|y>=1}
C. S = {y|y>=-1}
Explanation: The sample space gives us the possible outcomes for a stock's return rate. The return rate for a stock can be either positive or negative but cannot be less than -100%.
User Contributed Comments 18
| User | Comment |
|---|---|
| Carol1 | Good question, since stock doesn't have negative value. |
| treakj | Good Question.. |
| achu | Tricky and nasty question. |
| Yurik74 | sample space is the set of all possible outcomes of an experiment. For example, for tossing a single six-sided die, the sample space is {1, 2, 3, 4, 5, 6}. |
| LordHux | still don't get it, please help! |
| jpducros | Percentage return of a stock is between -100% and + infinity. -100% when the stock price goes to 0 and + infinity when the stock price goes very high...so y is necessarily >=-100% or >= -1 |
| mandig | the question is really testing |
| showmethemoney | btw who uses the expression 'sample space'?....... |
| screwjack | Statisticians |
| viruss | Yes very good question ... I felt for it ;) |
| farhan92 | cheeky question this! |
| Varun546 | Then why does the question restrict to ...only those with greater than 1% return. I don't get the answer |
| deathscyte | tricky question definitely should read carefully. |
| tisch187 | wont be on the exam either lol good to know though i guess |
| whatthehll | very unnescessary |
| iliavko | nowhere is Schweser.. These questions are suspicious! |
| odum612 | OZZY612: the question is unfriendly, but I will not give up on it. |
| wenhu | very good question |