The Optimal Level of Item Difficulty Is MOST Typically

question 6

Multiple Choice

The optimal level of item difficulty is MOST typically

• A) .5.
• B) the midpoint between 1.0 and the chance of success by random guessing.
• C) .25.
• D) the midpoint between 0 and the chance of success by random guessing.

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Definitions:

American Put Option

A financial derivative that gives the holder the right, but not the obligation, to sell a specific amount of an underlying asset at a specified price within a given time frame.

Black-Scholes

A mathematical model used to calculate the theoretical price of European style options based on risk, time, and other factors.

Variance

A statistical measure of the dispersion or spread between numbers in a data set.

Call Option

A financial contract giving the option buyer the right, but not the obligation, to buy a specified quantity of an asset at a set price within a specified time.