It Is Thought That 63

question 21

Multiple Choice

It is thought that 63.7% of the student body owns a school sweatshirt. A student reports that from a simple random sample of 1000 students, 637 own a school sweatshirt.

• A) This should be trusted since it matches exactly what was thought.
• B) It is highly unlikely that an SRS would yield results exactly matching what was expected.
• C) Thus, 6.37% of the sample own a school sweatshirt, which refutes the original thought.
• D) The student didn't get IRB approval, so the results are invalid.

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Definitions:

Producer Surplus

The difference between what producers are willing and able to supply a good for and the price they actually receive, measuring the benefit to producers.

Total Surplus

The total net gain to society from creating and consuming a product or service, encompassed by the combination of consumer and producer surplus.

Deadweight Loss

An inefficiency in the economy that results when the market equilibrium for a good or service isn't attained or is unattainable.

Tariff

A tax imposed on imported or, less commonly, exported goods with the aim of raising the cost to influence trade dynamics.