In the Literary Digest Poll Discussed in Your Text, the Poll

question 143

Multiple Choice

In the Literary Digest poll discussed in your text, the poll incorrectly indicated that Alf Landon would defeat Franklin Roosevelt in the upcoming election. In the real election, Roosevelt won in a landslide. The poll's inaccuracy was due to ______.

• A) the fact that most respondents felt their privacy was being intruded upon by the poll and lied about how they intended to vote
• B) the fact that the poll surveyed people over the phone, and at the time, only the wealthy had telephones
• C) improper statistical methods used by the researchers to tabulate the results of the poll
• D) the fact that the poll used vaguely worded questions that confused the respondents

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Definitions:

Compounded Monthly

A calculation method for interest where the interest earned is added to the principal at the end of each month, causing subsequent interest to be based on the increased balance.

Effective Annual Rate

The real interest rate on an investment or loan, considering the effects of compounding over a year.

Effective Annual Rate

The yield on a loan or investment taking into account the impact of compounding throughout a year.

Compounded

In finance, referring to the process where interest is calculated on the initial principal and also on the accumulated interest from previous periods.