The Mean of a Standard Normal Probability Distribution

question 74

Multiple Choice

The mean of a standard normal probability distribution

• A) is always equal to zero.
• B) can be any value as long as it is positive.
• C) can be any value.
• D) is always greater than zero.

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Definitions:

Substitution Effect

The change in consumption patterns due to a change in the relative prices of goods, leading consumers to substitute a cheaper good for a more expensive one.

Income Effect

The alteration in a person's or an economy's earnings and the effect this alteration has on the demand for a product or service.

Price Change

An alteration in the cost of goods or services, which can go up or down, depending on various factors.

Diamond/Water Paradox

An observation in economics illustrating how water, which is essential to life, is cheap, while diamonds, which do not sustain life, are expensive.