When We Want to Infer from a Sample to the Population

question 24

Multiple Choice

When we want to infer from a sample to the population, what assumption must be met?

• A) Sample is normally distributed
• B) Sample is large
• C) Population is normally distributed
• D) Population is large

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Definitions:

Beta

A metric that compares the level of risk and volatility of an individual security or portfolio to that of the general market.

SML

The Security Market Line, a graphical representation of the Capital Asset Pricing Model (CAPM) that displays the expected return of an investment as a function of its systemic risk.

Required Rate Of Return

The minimum percentage return an investor expects to receive from an investment, taking into account its risk.

Portfolio

A collection of investments held by an individual or institution, including stocks, bonds, commodities, and more, aimed at diversifying risk.