Investment Institutions Usually Have Funds with Different Risk Versus Reward

question 21

Multiple Choice

Investment institutions usually have funds with different risk versus reward prospectuses. A trading magazine wants to determine if the returns of high-risk funds is greater than low-risk funds. The magazine records the return of high- and low-risk funds for a sample of 22 institutions. For the Wilcoxon signed-rank test, where D = high-risk return − low-risk return, the value of the test statistic is T = T⁺ = 185. At the 10% significance level, the critical value is ________.

• A) 1.645
• B) 1.96
• C) 2.33
• D) 2.575

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