# Weighted Averages – CAT Scan

## 16 thoughts on “Weighted Averages – CAT Scan”

1. Girish |

Sir can u please explain how it will be the inverse of 16:9….

2. That is the see-saw logic mentioned in the previous couple of posts on weighted averages ðŸ™‚

regards
J

• k |

Dear J
My mind got sea saw feeling after reading explanation. kindly provide alternative solution if possible in reply.
Regards
K

• This was an alternative solution only. The normal solution could be by using regular weighted averages, or by creating equations. That you can find in several places online.

regards
J

3. Dear J,
This application using graphs was not very intuitive for me (personally) ðŸ˜¦ . Although you told that the ratio of their bases will govern their weights, but i’m just accepting it as it is, coz i’m not a fairly acquainted with this graphing technique ðŸ˜¦ . Can we some more questions and/or articles where we can learn these graphing techniques along with other concepts? I’ll be indebted if do so.

• This was more of Geometry really (similarity of triangles!)…I don’t really have any similar questions but am trying to come up with a set of posts on graphing approaches in general (mods/quadratics etc), so far don’t have a coherent plan in place for that. It is surprisingly difficult to explain on paper, it turns out….

regards
J

• latticesam |

You can record a short video ðŸ˜› , if you are facing difficulty.

• latticesam |

Dear J,
Other graphing techniques are fine like drawing a graph for MOD(2x-3), but I meant graphing where in we have to picturize some data (like the example above) rather than an algebraic expression. Percentage of B v/s C on a horizontal line (how does it come to mind). I want to learn that. ðŸ˜¦ Please do something.

4. Sir, I have a doubt. I started trying without goin thru solution first.

as Shabnam can fully utilize or partially utilize…. I assumed w1,w2 and w3 as weights. I end up with the equation: (w1*0.1% + w2*1% – w3*0.25%) / (w1+w2+w3). [I assumed 50% probability for rise and fall of market].

So I thought, in the numerator if I equalize the first term and the second term, I ll get the more return. Equalizing I found, w1:w2 :: 25:1, from this I got the total return as 0.78%.

I know my approach is wrong, If you could point out where it is.

Regards,
RZ

• The second weightage should be either 1 or 0. Either invest fully in that option or not at all ðŸ™‚ Because that is a “guaranteed return”. The others are changing and hence a combination of them might make more sense (this being a simplified version of what the Finance folks call hedging)

regards
J

5. gaurav raj |

sir,

i did not get comparing bases to investment

6. Gaurav |

Sir,
Could one try to solve such a question in a different way, i.e., instead of using the graphing technique. I tried to, but, couldn’t get my head around it.
Thank You

• Of course! You can solve it with equations as well (in fact that is how I solved this problem the first time I saw it – it is slightly slower but I didn’t spot this approach on that day!). The thing is, there will always be many ways to solve any given question; the more you know, the more likely you are to spot an efficient way to get an accurate answer.

regards
J

7. somyaranjan samal |

hello sir why you take difference to find ratios (5-(-3))-(2-(-2.5)

• Because that is the whole essence of the approach seen in the earlier posts?

regards
J