ECON2209 Lecture 14: 24February_EconStats_Karagodsky
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The area under a distribution curve tells us the probability of people that will be ____. We can make something similar with a average of a group of samples of a certain size. Our data points are just sample averages, so we have: where: and. Expected value of a sample mean is de ned as: The expected value and variance says that you are better o diversifying a stock portfolio because volatility(variance) goes down the larger the number of di erent stocks but expected returns ( ) stays the same. X is a rv with a mean of 40 and var 100. Let m = the average of 10 independent draws from x. No, central limit theorem doesn"t apply because the sample size isn"t big enough. Question 2: we know that = 8 and = 3, in underlying population distribution, we don"t know the exact distribution, but we know it is symmetric about the mean, sample size n = 36.
