A 500-point drop in the DJIA was a big drop when the DJIA was at 2246 in October of 1987 and a much smaller drop when the DJIA reached 11,421 in September of 2008. The percent by which stock prices fall is a more meaningful measure. The lesson here is that
A) rates are often more meaningful than counts.
B) it is easy to make a mistake calculating a percent.
C) the DJIA is a categorical variable.
D) confidentiality has been violated.

Question

Quizplus · Accepted Answer

This is because rates or percentages take into account the size or scale of the variable being measured, making it a more standardized measure that is comparable across different time periods, populations, or groups. Counts or raw numbers can be misleading if the size or scale of the variable changes over time or across groups.

A 500-Point Drop in the DJIA Was a Big Drop