Twenty Economists Were Sampled and Asked to Predict If the National

question 33

Multiple Choice

Twenty economists were sampled and asked to predict if the national economy would improve during the next 12 months. Eleven of the economists predicted an increase,two economists predicted no change,and seven economists predicted a decrease in the economy. Conduct a hypothesis test at the 0.10 significance level to determine if the majority of economists predicts an increase. The test statistic is ________.

• A)0.224
• B)1.179
• C)1.707
• D)0.179

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Definitions:

Taxable Yield

The interest rate on a bond or security that is subject to taxes, as opposed to a tax-exempt yield.

Tax Bracket

Categories of income tax rates that increase progressively with the level of taxable income of the taxpayer.

Price-Weighted Index

A stock market index in which each stock influences the index in proportion to its price per share.

Share Prices

The current price at which a company's shares can be bought or sold in the stock market.