In Statistical Discrimination

question 243

Multiple Choice

In statistical discrimination,

• A) the average characteristics of the group are applied to individual members.
• B) the characteristics of individual members of a group are applied to describe the group as a whole.
• C) hiring characteristics for workers are based on set government requirements
• D) workers are given preferential treatment if they help fulfill a quota for a particular type of characteristic.

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Definitions:

Well-Organized Markets

Financial markets characterized by high levels of efficiency, transparency, liquidity, and regulation, facilitating fair and orderly trading and pricing of securities.

Efficient Markets

A hypothesis suggesting that financial markets are "informationally efficient," meaning prices of securities reflect all available information at any moment.

Expected Risk Premium

The extra return investors require to hold a risky asset over a risk-free asset, reflecting the additional risk.