The Central Limit Theorem Is Important in Statistics Because

question 111

Multiple Choice

The Central Limit Theorem is important in statistics because

• A) for any sized sample, it says the sampling distribution of the sample mean is approximately normal.
• B) for any population, it says the sampling distribution of the sample mean is approximately normal, regardless of the sample size.
• C) for a large n, it says the population is approximately normal.
• D) for a large n, it says the sampling distribution of the sample mean is approximately normal, regardless of the shape of the population.

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Definitions:

Excess Burden

The cost to society created by market inefficiency, often associated with the distortionary effects of taxes and subsidies.

Tax Revenue

The income that is gained by governments through taxation, used to fund public services and government obligations.

Excess Burden

The economic loss that society suffers due to market inefficiencies or taxes beyond the collected tax revenue.

Economic Decisions

Choices made by individuals, firms, or governments regarding the allocation of scarce resources to satisfy needs and desires.