A Financial Analyst Is Interested in Estimating the Proportion of Publicly

question 57

Essay

A financial analyst is interested in estimating the proportion of publicly traded companies on the New York Stock Exchange that have cash balances that are more than 10 percent of the total assets of the company. A random sample of n = 100 companies shows that 13 had cash balances of more than 10 percent of assets. Based on this information, develop and interpret a 90 percent confidence interval estimate for the population proportion.

---

Definitions:

Entrepreneurial Alertness

An entrepreneur's ability to notice and take advantage of new business opportunities not seen by others.

Barriers Entry

Obstacles companies must overcome to enter a particular market, which may include high startup costs, regulation, or strong competition.

Infinite Number

A quantity without end or limit, often used in mathematics to describe sizes or quantities larger than any finite number.

Investment Decisions

The process of making choices about where to allocate resources and capital to generate returns.