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Principles of Finance

Multiple Choice

Principles of FinanceMultiple Choice
1 .
A data set of salaries contains an outlier salary. The best measure of center to use for this data set is the ________.
  1. mean
  2. median
  3. mode
  4. standard deviation
2 .
A portfolio includes shares of United Airlines stock that were purchased at different times and different prices. Which measure is best to determine the average cost of the shares of the stock?
  1. mean
  2. median
  3. weighted mean
  4. standard deviation
3 .
Standard deviation is a measure of the ________.
  1. center of a data set
  2. position of a data value in a data set
  3. area under a normal curve
  4. spread of a distribution
4 .
How are standard deviation and variance related?
  1. The two measures are equal to one another.
  2. Variance is the square root of the standard deviation.
  3. Standard deviation is the square root of the variance.
  4. The two squared measures are equal to one another.
5 .
Which of the following is the best definition of a z-score?
  1. the distance of a data value from the mean
  2. the number of standard deviations that a data value is from the mean
  3. the distance of a data value from the mean divided by the sample size
  4. the number of quartiles that a data value is from the mean
6 .
The results of a standardized test indicate that you are in the 85th percentile. What is the best interpretation of this result?
  1. You scored in the top 85% of all students taking the test.
  2. You scored in the top 15% of all students taking the test.
  3. Your score on the test is 85 when measured on a scale from 0 to 100.
  4. You scored in the bottom 15% of all students taking the test.
7 .
The interquartile range is ________.
  1. the middle 50% of a data set
  2. the upper 50% of a data set
  3. the lower 50% of a data set
  4. equal to the median
8 .
In a frequency distribution table, the sum of the relative frequencies must be equal to ________.
  1. the sample size
  2. 1, or 100%
  3. zero
  4. the standard deviation of the distribution
9 .
A change in the standard deviation of a normal distribution will result in ________.
  1. a change in the location of the peak of the curve
  2. a change in the area under the curve
  3. a change in the shape of the curve
  4. a change that shifts the graph to the left or the right
10 .
When calculating an expected value, ________.
  1. the result should always be 1
  2. the result should always be a positive value
  3. the result should always be a negative value
  4. the result can be a positive or negative value
11 .
The area under a normal curve between a z-score of -2 and a z-score of +2 is ________.
  1. 0.68
  2. 0.95
  3. 0.997
  4. dependent on the mean and standard deviation
12 .
A scatter plot is a visualization for ________.
  1. univariate data only
  2. bivariate data only
  3. either univariate or bivariate data
  4. test scores
13 .
Which of the following is NOT a benefit of using the R statistical analysis tool?
  1. Additional features are constantly being added by the user community.
  2. It can be used on many computer platforms, including Mac, Windows, and Linux.
  3. It is free to download.
  4. Users pay an annual subscription fee.
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