An Energy Analyst Wants to Test If U

question 105

Multiple Choice

An energy analyst wants to test if U.S. oil production is random over time. The analyst has monthly production values for the two years. The analyst finds 12 months are above the median, 12 months are below the median, six runs are below the median, and five runs are above the median. To test the random-walk hypothesis about oil production, the competing hypothesis are ________.

• A) H₀: Oil production is not random; H_A: Oil production is random
• B) H₀: Oil production is random; H_A: Oil production increases over time
• C) H₀: Oil production is random; H_A: Oil production decreases over time
• D) H₀: Oil production is random; H_A: Oil production is not random

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Definitions:

Economics

The social science that analyses the production, distribution, and consumption of goods and services.

Arbitrary

Stemming from a random selection or personal impulse instead of being guided by any logical rationale or structured approach.

Representation

The act of speaking or acting on behalf of someone or the depiction of something in art or literature.

Symbol

A symbol is a mark, sign, or word that indicates, signifies, or is understood as representing an idea, object, or relationship.