A stock analyst was provided with a list of 25 stocks. He was expected to pick 3 stocks from the list whose prices are expected to rise by more than 20% after 30 days. In reality, the prices of
Only 5 stocks would rise by more than 20% after 30 days. If he randomly selected 3 stocks from
The list, he would use what type of probability distribution to compute the probability that all of
The chosen stocks would appreciate more than 20% after 30 days?
A) binomial distribution.
B) Poisson distribution.
C) hypergeometric distribution.
D) none of the above.

Question

Quizplus · Accepted Answer

The hypergeometric distribution is used when sampling without replacement from a finite population, which is the case here as the analyst is selecting stocks from a fixed list.

A Stock Analyst Was Provided with a List of 25