Financial analyst Larry Potts needs a sample of 100 securities listed on the New York Stock Exchange. In the current issue of the Wall Street Journal,2,531 securities are listed in the "New York Exchange Composite Transactions," an alphabetical listing of all securities traded on the previous business day. Larry randomly selects the 7th security as a starting point,and selects every 25th security thereafter (7,32,57,etc.). His sample is a ____________.
A) quota sample
B) simple random sample
C) stratified sample
D) systematic sample
E) cluster sample

Question

Quizplus · Accepted Answer

Larry's sample is a systematic sample because he is selecting every 25th security from a predetermined starting point. It is not a simple random sample because he is not selecting securities completely at random, and it is not a quota sample because he is not aiming to have a certain number of securities from each category. Similarly, it is not a stratified sample or a cluster sample as these involve dividing the population into subgroups or clusters and selecting a sample from each of those.

Financial Analyst Larry Potts Needs a Sample of 100 Securities