When a Large Sample Is Taken,_______________ Approximation to the Binomial

question 5

Multiple Choice

When a large sample is taken,_______________ approximation to the binomial distribution can be used to implement the sign test.

• A)Chi-square
• B)normal
• C)correlation coefficient
• D)Rank sum

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Definitions:

Low Collateral Value

Low collateral value refers to assets that have declined in worth, offering less security for loans and reducing borrowing capacity.

Credit Scoring

A system used by lenders to evaluate the creditworthiness of potential borrowers, resulting in a score that predicts the likelihood of repayment.

Probability of Default

The probability that a borrower will fail to fulfill their debt responsibilities.

Credit Policy

The guidelines a company follows to determine the amount and terms of credit to extend to customers.