## Related questions with answers

In a large Business Statistics class, the professor has each person select stocks by throwing 16 darts at pages of the Wall Street Journal. They then check to see whether their stock picks rose or fell the next day and report their proportion of "successes." As a lesson, the professor has selected pages of the Journal for which exactly half the publicly traded stocks went up and half went down. The professor then makes a histogram of the reported proportions.

b) Confirm that you can use a Normal model here.

Solution

VerifiedWe were given a situation where each student in a large Business Statistics class used computer-generated random numbers to choose $25$ stocks each. We know that exactly half of the publicly traded stocks went up and the other half went down. The students then reported the proportion of "successes" to the professor since they were asked to check if their stock picks rose or fell.

We were then asked to confirm that we can use a Normal model as the sampling distribution model of the sample proportion $\hat{p}$.

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