Investment Institutions Usually Have Funds with Different Risk Versus Reward

question 21

Multiple Choice

Investment institutions usually have funds with different risk versus reward prospectuses. A trading magazine wants to determine if the returns of high-risk funds is greater than low-risk funds. The magazine records the return of high- and low-risk funds for a sample of 22 institutions. For the Wilcoxon signed-rank test, where D = high-risk return − low-risk return, the value of the test statistic is T = T⁺ = 185. At the 10% significance level, the critical value is ________.

• A) 1.645
• B) 1.96
• C) 2.33
• D) 2.575

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Definitions:

Sub-Atomic Particle

Particles smaller than atoms, including protons, neutrons, and electrons.

Atoms Produce Light

The phenomenon where atoms emit light when electrons jump from higher to lower energy levels, releasing photons.

Continuous Spectrum

A seamless spectrum of light (or other electromagnetic radiation) in which every wavelength within a certain range is represented.

Energy Level

The specific amount of energy an electron can have when occupying a certain orbital in an atom.