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If the economy does well, the investor's wealth is 2 and if the economy does poorly the investor's wealth is 1. Both outcomes are equally likely. The investor is offered to invest in shares of a project that gains 3=2 if the economy does well and loses 1 if the economy does poorly. Therefore, if the investor obtains α shares of this project his wealth is 2 + 3α/2
with probability 1/2 and 1= α with probability 1/2. The investor is an expected utility maximizer with utility index u(z) = ln z. What is the optimal α for this investor? ( α must be between 0 and 1).
Advantages of Sampling Why should we settle on a sample instead of studying the entire population? Sampling has the following advantages over a census (study of the entire pop
Among the students doing a given course, there are four boys enrolled in the ordinary version of the course, six girls enrolled in the ordinary version of the course,and six boys e
1. Use the concepts of sampling error and z-scores to explain the concept of distribution of sample means. 2. Describe the distribution of sample means shape for samples of n=36
What does the confidence level of a confidence interval tell you? Suppose that a population has mean, µ, and standard deviation, σ. What does the central limit theorem tell us
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how to interpret results, a good explanation to help me understand.
Celia is a nurse in a geriatric ward. She noticed that older persons in her care are having problems sleeping at night. She decided to introduce non-pharmocologic ways of relaxat
Statistical Keys To do statistical operations we must first set the calculator on SD mode [SD stands for "standard deviation" which is the usual st
The cornlnunalities h j represent the fraction of the total variance' 'accounted for of variabie j. Ry calculating the communalities we can keep track of how much of-the orig
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