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Question 958  confidence interval, normal distribution

A stock's returns are normally distributed with a mean of 8% pa and a standard deviation of 15 percentage points pa. What is the 99% confidence interval of returns over the next year? Note that the Z-statistic corresponding to a one-tail:

  • 90% normal probability density function is 1.282.
  • 95% normal probability density function is 1.645.
  • 97.5% normal probability density function is 1.960.
  • 99% normal probability density function is 2.326.
  • 99.5% normal probability density function is 2.576

The 99% confidence interval of annual returns is between:




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