A Fund Manager Wants to Know If It Is Equally

question 27

Multiple Choice

A fund manager wants to know if it is equally likely that the Dow Jones Industrial Average will go up each day of the week. For each day of the week, the fund manager observes the following number of days when the Dow Jones Industrial Average goes up. Using the critical value approach, the decision and conclusion are

• A) reject the null hypothesis; not all of the proportions are the same
• B) reject the null hypothesis; all of the proportions are not the same
• C) do not reject the null hypothesis; all of the proportions are the same
• D) do not reject the null hypothesis; we cannot conclude that not all of the proportions are the same

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Definitions:

African Nation

An independent, sovereign country located on the African continent.

World Trade Organization

An international organization designed to facilitate and regulate international trade by providing a forum for negotiations and dispute resolution.

Developing Nation

A term used to describe a country with a relatively low level of industrial and economic development.

Economies of Scale

Cost advantages that entities obtain due to their scale of operation, leading to a reduction in per-unit cost as production increases.