The Average Annual Return for the S&P 500 from 1886

question 90

Multiple Choice

The average annual return for the S&P 500 from 1886 to 2006 is 5%, with a standard deviation of 15%. Based on these numbers, what is a 95% confidence interval for 2007's returns?

• A) -12.5%, 17.5%
• B) -15%, 25%
• C) -25%, 35%
• D) -25%, 25%

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Definitions:

Nonsense Syllables

A string of letters that do not form a known word, used in psychological experiments on memory.

Forgetting

Forgetting is the process through which information is lost from memory, whether through decay over time, lack of retrieval cues, interference, or failure to store in memory.

Misinformation Effect

The misinformation effect occurs when a person's recall of an event becomes less accurate due to being exposed to misleading information about the event.

Misleading Information

Incorrect or false information that leads to incorrect perceptions or conclusions.