Discuss the below:
Q: Currently the stock market is declining. A stock broker wishes to determine his portfolio. She randomly choose 64 daily stock prices for stock A from the past year data, and obtain the 95.44% confidence interval for the average price to be [ $30.0 , $40.0]
A. What is the confidence coefficient? a) 50% b) .9544 c) 40.00 d) $35.00
B. What is the average stock price of these 64 daily prices? a) $35.00 b) $30.00 c) $40.00 d) 95.44%
C. Which test statistic is appied for this situation? aa) Z bb) t cc) None of the above. Not quite sure , but I think it is aa) Z, correct me if I am wrong.
D. Which statemnt is correct: a) This is a small sample b) This is a large sample. c) We should not invest in the stock market. d) The current stock market for stock A is very good.
E. What is an appropriate interpretation of the interval [430.0 , $40.0] a) 95.44% sure each daily price is between $30 and $40. b) 95.44% of daily stock prices fall into $30 and $40. c) 95.44% sure the true average price of stock A in between $30 and $40. d) 95.44% sure the sample average price of these 64 daily prices is between $30 and $40.
F.If we decide to compute an 80% confidence interval for the average price of stock A using the same data, then, 80% confidence interval would be____ the 95.44% confidence interval: a) narrower than. b) wider than. c) the same as.