If We Compare One Standard Deviation with Another Distribution of Equal

question 2

Multiple Choice

If we compare one standard deviation with another distribution of equal mean but larger standard deviation, we could say that:

• A)the risk of the distribution is equal.
• B)the distribution with the larger standard deviation is riskier.
• C)the distribution with the smaller standard deviation is riskier.
• D)it is impossible to tell which distribution is riskier because the mean is equal.
• E)the distribution with the higher severity would be riskier.

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Definitions:

Marginal Tax Rates

The rate at which the next dollar of taxable income would be taxed, applied within a progressive income tax system.

Capital Gains

The increase in the value of an investment or real estate from the purchase price to the selling price, not realized until the asset is sold.

Interest Income

Income that is earned from deposit accounts or investments that pay interest, such as savings accounts, bonds, or loans.

Nova Scotia

A province located on Canada's southeastern coast, known for its high tides, lobster fishing, and historic sites.