Failure to Meet Payments on Student Loans Has Been a Major

question 75

Multiple Choice

Failure to meet payments on student loans has been a major problem for both banks and the government. Approximately 50% of all student loans are in default. A random sample of 350 loans to students indicates that 147 are in default.
-The p-value associated with the test statistic is _____.

• A).0028
• B).0262
• C).0525
• D).0014
• E).0012

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Definitions:

Market Return

The total return on investment, including capital gains and dividends, from investing in the stock market over a specific period.

CAPM Equation

The formula used in the Capital Asset Pricing Model that describes the relationship between the risk of an investment and its expected return.

Company

A legal entity formed by a group of individuals to engage in and operate a business—commercial or industrial—enterprise.

Expected Return

The anticipated gain or loss that an investor predicts from an investment over a period, based on historical averages or estimated models.