When a Statistical Average Is Reported in the News, It

question 7

Multiple Choice

When a statistical average is reported in the news, it is most important for readers to

• A) determine whether it is statistically significant.
• B) consider whether it is distorted by a few extreme cases.
• C) be sure that it describes a truly random sample.
• D) recognize the potential for illusory correlation.

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Definitions:

Adjustment Subsidiary Ledger

A detailed ledger that contains adjustments or modifications to accounts, used to support the primary accounting records.

Sales Returns And Allowances

Concessions granted to customers for returned goods or from granting reductions in the original sales price.

Sales Discounts

Reductions in the price sold given by a seller to a buyer, often used as an incentive for early payment or bulk purchases.

Accounts Receivable

Money owed to a company by its customers for goods or services delivered but not yet paid for.