A Fund Manager Wants to Know If the Annual Rate

question 60

Multiple Choice

A fund manager wants to know if the annual rate of return is greater for growth stocks (sample 1) than for value stocks (sample 2) . The fund manager collects data on the returns of growth and value funds. Below are the sample sizes and rank sums for the Wilcoxon rank-sum test. To determine whether the median return of growth funds is larger than the median return of value funds, the competing hypotheses are ________.

• A) H₀: m₁ - m₂ ≥ 0; H_A: m₁ - m₂ < 0
• B) H₀: m₁ - m₂ ≤ 0; H_A: m₁ - m₂ > 0
• C) H₀: m₁ - m₂ ≠ 0; H_A: m₁ - m₂ = 0
• D) H₀: m₁ - m₂ = 0; H_A: m₁ - m₂ ≠ 0

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Definitions:

Concurrent Validation

A method of validating a test by comparing its results with relevant criteria measured at the same time, used to assess the accuracy of a test or measurement tool.

Potential Advantages

Benefits or strengths that an organization or individual could exploit to achieve its objectives.

Nondirective Interviews

An interviewing technique where the interviewer asks open-ended questions, allowing the interviewee to guide the conversation.

Low Reliability

Low Reliability indicates a lack of consistency and dependability in performance or results, affecting trustworthiness and effectiveness.