In a Sample of 400 Students in a University, 80

question 61

Multiple Choice

In a sample of 400 students in a university, 80 or 20% are Business majors. Based on the above information, the school's paper reported that "20% of all the students at the university are Business majors." This report is an example of

• A) a sample.
• B) a population.
• C) statistical inference.
• D) descriptive statistics.

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Definitions:

M&M Proposition I

A theory stating that, in a perfect market, the value of a firm is unaffected by how it is financed, regardless of the debt-to-equity ratio.

Capital Structure

Refers to the way a corporation finances its assets through a combination of equity, debt, or hybrid securities.

M&M Proposition I

Modigliani and Miller's principle suggesting the irrelevance of financial leverage on a company's valuation in an ideal market.

Debt-Equity Ratio

A calculation of a firm's financial leverage determined by dividing its overall liabilities by the equity of its shareholders.