Which of the Following Statements About the Confidence Interval Is

question 21

Multiple Choice

Which of the following statements about the confidence interval is not correct?

• A) A confidence interval is based on the outcomes of the probability distribution.
• B) A confidence interval is calculated by adding and subtracting the standard deviation to/from the estimate of mean expected loss.
• C) A confidence interval tells the insurer something about the size of the risk pool.
• D) A confidence interval tells the insurer something about how much money it needs to cover potential losses.

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Definitions:

Comparative Balance Sheet

A financial statement that presents the assets, liabilities, and equity of an entity at two or more points in time for comparison purposes.

Cash Dividends

A distribution of a portion of a company's earnings, decided by the board of directors, paid to shareholders in cash.

Operating Activities

Activities that are directly related to the day-to-day operations of a business, generating revenue and expenses.

Comparative Balance Sheet

A financial statement presenting a company's assets, liabilities, and equity at two or more points in time for comparative purposes.