A Financial Analyst Maintains That the Risk,measured by the Variance,of

question 93

Multiple Choice

A financial analyst maintains that the risk,measured by the variance,of investing in emerging markets is more than 280(%) ².Data on 20 stocks from emerging markets revealed the following sample results: = 12.1% and s² = 361(%) ² .Assume that the returns are normally distributed.Which of the following is the correct value of the test statistic?

• A) = 36.19
• B) = 24.50
• C) = 24.50

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Definitions:

Expansionary Policy

Economic policies implemented by a government to stimulate growth in a sluggish economy, typically by increasing money supply or reducing taxes.

Economic Stability

Economic stability refers to a state where an economy experiences constant growth, low inflation, and low unemployment, reflecting a balanced economic environment.

Stock-Market Crash

A rapid and often unanticipated drop in stock prices across a significant cross-section of a stock market, resulting in a loss of paper wealth.

Great Depression

A severe worldwide economic downturn that took place during the 1930s, marked by widespread unemployment and poverty.