APPLIED MANAGEMENT STATISTICS

Running head: APPLIED MANAGEMENT STATISTICS
Applied Management Statistics
Name of the Student
Name of the University
Course ID

APPLIED MANAGEMENT STATISTICS1
Table of Contents
Case Problem 1: Stock Market........................................................................................................2
Question a....................................................................................................................................2
Question b....................................................................................................................................3
Question c....................................................................................................................................7
Question d....................................................................................................................................8
References........................................................................................................................................9

APPLIED MANAGEMENT STATISTICS2
Case Problem 1: Stock Market
Question a
Table 1: Descriptive statistics of the stock market
Exxon Mobil, Caterpillar, McDonald’s, Sandisk, Qualcomm and Procter & Gamble had a
higher mean return than the market return.
The standard deviation is the largest for Sandisk meaning that Sandisk had the most
volatile return.
The S&P index acts as a portfolio of different companies which reduces the unsystematic
risk to a stock. The only risk associated with S&P index is the market risk or systematic risk. In
contrast, when stock return for specific companies are taken into consideration the unsystematic
risks are not diversifiable making make stock more volatile (Hollstein, Prokopczuk and Wese
Simen 2020). Therefore, the main reason for S&P index to be less volatile are the diversification
and reduction of unsystematic risk.