41. Two samples were drawn from two normally distributed populations. For the first sample, the mean was $50 and the standard deviation was $5. For the second sample, the mean was $55 and the standard deviation was $6. The first sample consists of 25 observations and the second sample consists of 36 observations.

Consider the hypotheses structured as H0: 1 = $48 versus Ha: 1 $48. At a 1% level of significance, the null hypothesis:

A. cannot be rejected

B. should be rejected

C. cannot be tested using the sample information provided

42. William Adams wants to test whether the mean monthly returns over the last five years are the same for two stocks. If he assumes that the returns distributions are normal and have equal variances, the type of test and test statistic are best described as:

A. paired comparisons test, t-statistic

B. paired comparisons test, F-statistic

C. difference in the means test, t-statistic

43. For a hypothesis test with a probability of a Type II error of 60% and a probability of a Type I error of 5%, which of the following statements is most accurate?

A. The power of the test is 40%, and there is a 5% probability that the test statistic will exceed the critical value(s)

B. There is a 95% probability that the test statistic will be between the critical values if this is a two-tailed test

C. There is a 5% probability that the null hypothesis will be rejected when actually true, and the probability of rejecting the null when it is false is 40%

44. When constructing a confidence interval for the population mean of a nonnormal distribution when the population variance is unknown and the sample size is large (n > 30), an analyst may acceptably use:

A. either a z-statistic or a t-statistic

B. only a z-statistic at with n degrees of freedom

C. only a t-statistic at /2 with n degrees of freedom

45. Which of the following is most closely associated with survivorship bias?

A. Price-to-book studies

B. Stratified bond sampling studies

C. Mutual fund performance studies

46. Which of the following is least likely a property of Students t-distribution?

A. As the degrees of freedom get larger, the variance approaches zero

B. It is defined by a single parameter, the degrees of freedom, which is equal to n 1

C. It has more probability in the tails and less at the peak than a standard normal distribution

47. Which of the following terms represents an upper price limit for a stock, based on the quantity of willing sellers?

A. Trendline

B. Channel

C. Resistance

48. The daily opening price is represented on a candlestick chart by the:

A. Real body

B. Channel

C. Shadow

49. One of the most popular tools used by technical analysts is:

A. P/E ratio

B. Growth rate of dividends

C. Moving averages

50. Which of the following indicates a sell signal to technical analysts?

A. The advance-decline line is rising in a falling market

B. The amount of short selling done by specialists is high

C. The resistance level is broken