Four Students Have Applied to a Special Program and Only

question 36

Multiple Choice

Four students have applied to a special program and only one can be accepted.They have taken a battery of 12 tests and all have exactly the same average score.The standard deviation of their test scores are: Student A = 3.12,Student B = 0.27,Student C = 13.45,Student D = 6.45.If consistency of performance is a criteria for acceptance,which of the four students should be selected?

• A)A
• B)B
• C)C
• D)D

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Definitions:

Real Interest Rate

Represents the rate of interest an investor expects to receive after allowing for inflation.

Inflation

The pace at which prices for general goods and services ascend, thus diminishing the capability to purchase.

Real Interest Rate

The interest rate adjusted for the inflation rate, reflecting the real cost of borrowing and the real yield to lenders or investors.

Nominal Interest Rate

The rate of interest before adjusting for inflation, representing the face value of interest payments.