# on 17-Dec-2018 (Mon)

#### Flashcard 1611287366924

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#balance-sheet-analysis
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[...] ratios measure the ability of a company to meet future short-term financial obligations.
Liquidity ratios

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Subject 5. Uses and Analysis of the Balance Sheet
Balance Sheet Ratios Liquidity ratios measure the ability of a company to meet future short-term financial obligations from current assets and, more importantly, cash flows. Each of the following ratios takes a slightly different view of cash or near-cash items. Current Ratio is a measure of the number of dollars of current assets available to

#### Flashcard 1611290512652

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[...] is a measure of the number of dollars of current assets available to meet current obligations.
Current Ratio

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Subject 5. Uses and Analysis of the Balance Sheet
tios measure the ability of a company to meet future short-term financial obligations from current assets and, more importantly, cash flows. Each of the following ratios takes a slightly different view of cash or near-cash items. <span>Current Ratio is a measure of the number of dollars of current assets available to meet current obligations. It is the best-known liquidity measure. A current ratio of less than 1 indicates the company has negative working capital. Quick Rati

#### Flashcard 1611295231244

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A current ratio of less than 1 indicates the company has [...]
negative working capital.

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Subject 5. Uses and Analysis of the Balance Sheet
the following ratios takes a slightly different view of cash or near-cash items. Current Ratio is a measure of the number of dollars of current assets available to meet current obligations. It is the best-known liquidity measure. <span>A current ratio of less than 1 indicates the company has negative working capital. Quick Ratio (Acid-Test Ratio) eliminates less liquid assets, such as inventory and pre-paid expenses, from the current ratio. If inve

#### Flashcard 1611305454860

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Quick Ratio (Acid-Test Ratio) = [...]

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Subject 5. Uses and Analysis of the Balance Sheet
of dollars of current assets available to meet current obligations. It is the best-known liquidity measure. A current ratio of less than 1 indicates the company has negative working capital. <span>Quick Ratio (Acid-Test Ratio) eliminates less liquid assets, such as inventory and pre-paid expenses, from the current ratio. If inventory is not moving, the quick ratio is a better indicator of cash and near-cash items that will be available to meet current obligations. Cash Ratio is the most conservative liquidity ratio, determined by eliminating receivables from the quick ratio. As with the elimination of

#### Flashcard 1611308600588

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[...] is the most conservative liquidity ratio.
Cash Ratio

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Subject 5. Uses and Analysis of the Balance Sheet
ory and pre-paid expenses, from the current ratio. If inventory is not moving, the quick ratio is a better indicator of cash and near-cash items that will be available to meet current obligations. <span>Cash Ratio is the most conservative liquidity ratio, determined by eliminating receivables from the quick ratio. As with the elimination of inventory in the quick ratio, there is no guarantee that the receivables will be collected.

#### Flashcard 1611318037772

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Higher debt-equity ratio indicates [...]

higher financial risk.

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Subject 5. Uses and Analysis of the Balance Sheet
13; Solvency ratios measure a company's ability to meet long-term and other obligations. Long-Term Debt-Equity Ratio is an indicator of the degree of protection available to the creditors in the event of insolvency of a company. <span>Higher debt-equity ratio indicates higher financial risk. Debt-Equity Ratio includes short-term debt in the numerator. The total debt inclu

#### Flashcard 1611320397068

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Long-Term Debt-Equity Ratio = [...]

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Subject 5. Uses and Analysis of the Balance Sheet
ory in the quick ratio, there is no guarantee that the receivables will be collected. Solvency ratios measure a company's ability to meet long-term and other obligations. <span>Long-Term Debt-Equity Ratio is an indicator of the degree of protection available to the creditors in the event of insolvency of a company. Higher debt-equity ratio indicates higher financial risk. Debt-Equity Ratio includes short-term debt in the numerator. The total debt inclu

#### Flashcard 1611322756364

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[...] includes short-term debt in the numerator.

Debt-Equity Ratio

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Subject 5. Uses and Analysis of the Balance Sheet
rm Debt-Equity Ratio is an indicator of the degree of protection available to the creditors in the event of insolvency of a company. Higher debt-equity ratio indicates higher financial risk. <span>Debt-Equity Ratio includes short-term debt in the numerator. The total debt includes all liabilities, including non-interest-bearing debt such as accounts payables, accrued expenses, and deferre

#### Flashcard 1611325115660

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Debt-Equity Ratio = [...]

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Subject 5. Uses and Analysis of the Balance Sheet
rm Debt-Equity Ratio is an indicator of the degree of protection available to the creditors in the event of insolvency of a company. Higher debt-equity ratio indicates higher financial risk. <span>Debt-Equity Ratio includes short-term debt in the numerator. The total debt includes all liabilities, including non-interest-bearing debt such as accounts payables, accrued expenses, and deferre

#### Flashcard 1611329834252

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Total Debt Ratio =

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Subject 5. Uses and Analysis of the Balance Sheet
ilities, including non-interest-bearing debt such as accounts payables, accrued expenses, and deferred taxes. This ratio is especially useful in analyzing a company with substantial financing from short-term borrowing. <span>Total Debt Ratio = Financial Leverage Ratio = Financial statement analysis aims to investigate a company's financial condition and operating performance. Using financial rati

#### Flashcard 1611332193548

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Financial Leverage Ratio =

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Subject 5. Uses and Analysis of the Balance Sheet
ing debt such as accounts payables, accrued expenses, and deferred taxes. This ratio is especially useful in analyzing a company with substantial financing from short-term borrowing. Total Debt Ratio = <span>Financial Leverage Ratio = Financial statement analysis aims to investigate a company's financial condition and operating performance. Using financial ratios helps to examine relationships among indi

#### Flashcard 1612732304652

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How can you tell by ratios if a company has negative working capital?
A current ratio of less than 1

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Subject 5. Uses and Analysis of the Balance Sheet
the following ratios takes a slightly different view of cash or near-cash items. Current Ratio is a measure of the number of dollars of current assets available to meet current obligations. It is the best-known liquidity measure. <span>A current ratio of less than 1 indicates the company has negative working capital. Quick Ratio (Acid-Test Ratio) eliminates less liquid assets, such as inventory and pre-paid expenses, from the current ratio. If inve

#### Flashcard 1621333773580

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#tvm
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What rates are included in the nominal rate of interest?
real risk-free

inflation.

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The nominal risk-free rate of return includes both the real risk-free rate of return and the expected rate of inflation. A decrease in expected inflation rate would decrease the nominal risk-free rate of return, but would have no effect on the real risk-free rate of return.

#### Flashcard 1621336132876

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A decrease in expected inflation rate would decrease the [...]
nominal risk-free rate of return

but would have no effect on the real risk-free rate of return.

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The nominal risk-free rate of return includes both the real risk-free rate of return and the expected rate of inflation. A decrease in expected inflation rate would decrease the nominal risk-free rate of return, but would have no effect on the real risk-free rate of return.

#### Flashcard 1621372046604

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The [...] is the single-period interest rate for a completely risk-free security if no inflation were expected.

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#### Flashcard 1621380435212

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Many countries have governmental short-term debt whose interest rate can be considered to represent the [...] interest rate in that country.
nominal risk-free

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#### Flashcard 1621382270220

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What is Mexico's nominal risk-free interest rate?
CETES

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#### Flashcard 1621384891660

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The [...] compensates investors for the risk of loss relative to an investment’s fair value if the investment needs to be converted to cash quickly.

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#### Flashcard 1621395901708

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How many ways to quote interest rates for investments paying more than once a year?
three

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#### Flashcard 1621399571724

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If a bank states that a particular CD pays a rate of 3% that compounds 4 times a year this is an example of what kind of rate?
Periodic interest rate

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#### Flashcard 1621401406732

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[...], is the annual rate of interest that does not account for compounding within the year.
Stated annual interest rate

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#### Flashcard 1621405863180

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Which is the annual interest rate quoted by financial institutions?
Stated annual interest rate

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#### Flashcard 1621407698188

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The periodic interest rate multiplied by the number of compounding periods per year is equal to the [...]
Stated annual interest rate

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#### Flashcard 1621409533196

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[...] is the annual rate of interest that takes full account of compounding within the year.
Effective annual rate (EAR)

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#### Flashcard 1621439941900

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What is the difference between nominal risk-free rate and real risk-free rate of return?
The nominal one takes inflation into account

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The nominal risk-free rate of return includes both the real risk-free rate of return and the expected rate of inflation. A decrease in expected inflation rate would decrease the nominal risk-free rate of return, but would have no effect on the real risk-free rate of return.

#### Flashcard 1621961870604

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Cual es el truco para calcular continuous compounding?
poner en C/Y 12 luego 2ND y ex

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#### Parent (intermediate) annotation

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Exhibit 2. Common Accounts Assets Cash and cash equivalents Accounts receivable, trade receivables Prepaid expenses Inventory Property, plant, and equipment Investment propert

#### Original toplevel document

3.1. Financial Statement Elements and Accounts
ounting periods), and sales returns and allowances (an offset to revenue reflecting any cash refunds, credits on account, and discounts from sales prices given to customers who purchased defective or unsatisfactory items). <span>Exhibit 2. Common Accounts Assets Cash and cash equivalents Accounts receivable, trade receivables Prepaid expenses Inventory Property, plant, and equipment Investment property Intangible assets (patents, trademarks, licenses, copyright, goodwill) Financial assets, trading securities, investment securities Investments accounted for by the equity method Current and deferred tax assets [for banks, Loans (receivable)] Liabilities Accounts payable, trade payables Provisions or accrued liabilities Financial liabilities Current and deferred tax liabilities Reserves Unearned revenue Debt payable Bonds (payable) [for banks, Deposits] Owners’ Equity Capital, such as common stock par value Additional paid-in capital Retained earnings Other comprehensive income Minority interest Revenue Revenue, sales Gains Investment income (e.g., interest and dividends) Expense Cost of goods sold Selling, general, and administrative expenses “SG&A” (e.g., rent, utilities, salaries, advertising) Depreciation and amortization Interest expense Tax expense Losses For presentation purposes, assets are sometimes categorized as “current” or “non-current.” For example, Tesco (a large European retailer) prese

#### Flashcard 1621978123532

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FV1 = [...]
PV(1 + r)

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#### Flashcard 1621979958540

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[...] is the amount of funds originally invested

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#### Flashcard 1621981793548

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The interest earned each period on the original investment.
Simple interest

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#### Flashcard 1621984677132

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The process of accumulating interest on interest.

Compounding

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#### Flashcard 1621989395724

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FVN = [...]

PV(1 + r)N

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#### Flashcard 1621992803596

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We can add amounts of money only if [...]
they are indexed at the same point in time.

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#### Flashcard 1621996473612

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With more than one compounding period per year, the future value formula can be expressed as

FVN = PV (1 + rs/m )mN

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#### Flashcard 1621998308620

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The formula for the future value of a sum in N years with continuous compounding is

FVN = PV ersN

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#### Flashcard 1622000143628

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[...] ≈ 2.7182818

e

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#### Flashcard 1622004862220

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A [...] is a set of level never-ending sequential cash flows, with the first cash flow occurring one period from now.
perpetuity

a perpetual annuity,

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#### Flashcard 1622006172940

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An [...] is a finite set of level sequential cash flows.

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#### Flashcard 1622010629388

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An [...] has a first cash flow that occurs immediately (indexed at t = 0).

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#### Flashcard 1622020853004

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For a given discount rate, the farther in the future the amount to be received, the [...]
smaller that amount’s present value.

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#### Flashcard 1622234762508

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Interest calculated on the principal only.
Simple interest

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#### Flashcard 1622722088204

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Formula de valor presente de una perpetuidad

PV = A/r

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#### Flashcard 1636574301452

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The median is the value that [...]
stands in the middle of the data set, and divides it into two equal halves

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Subject 4. Measures of Center Tendency
ice inflates the weighted mean relative to the un-weighted mean. Median In English, the word "mediate" means to go between or to stand in the middle of two groups, in order to act as a referee, so to speak. <span>The median does the same thing; it is the value that stands in the middle of the data set, and divides it into two equal halves, with an equal number of data values in each half. To determine the median, arrange the data from highest to lowest (or lowest to highest) and find the middle observation.

#### Flashcard 1636576660748

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To determine the median the first step is to [...]
arrange the data from highest to lowest (or lowest to highest)

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Subject 4. Measures of Center Tendency
groups, in order to act as a referee, so to speak. The median does the same thing; it is the value that stands in the middle of the data set, and divides it into two equal halves, with an equal number of data values in each half. <span>To determine the median, arrange the data from highest to lowest (or lowest to highest) and find the middle observation. If there are an odd number of observations in the data set, the median is the middle observation (n + 1)/2 of the data set. If the number of observation

#### Flashcard 1636579020044

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Second step in finding the median
find the middle observation.

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Subject 4. Measures of Center Tendency
value that stands in the middle of the data set, and divides it into two equal halves, with an equal number of data values in each half. To determine the median, arrange the data from highest to lowest (or lowest to highest) and <span>find the middle observation. If there are an odd number of observations in the data set, the median is the middle observation (n + 1)/2 of the data set. If the number of observations is even, there is no single mid

#### Flashcard 1636617817356

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If there are an odd number of observations in the data set, the median formula is [...]
(n + 1)/2

The middle observation

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Subject 4. Measures of Center Tendency
dle of the data set, and divides it into two equal halves, with an equal number of data values in each half. To determine the median, arrange the data from highest to lowest (or lowest to highest) and find the middle observation. <span>If there are an odd number of observations in the data set, the median is the middle observation (n + 1)/2 of the data set. If the number of observations is even, there is no single middle observation (there are two, actually). To find the median, take the arithmetic mean of the two middle o

#### Flashcard 1636620963084

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If the number of observations is even, how do you find the median?
Take the arithmetic mean of the two middle observations.

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Subject 4. Measures of Center Tendency
determine the median, arrange the data from highest to lowest (or lowest to highest) and find the middle observation. If there are an odd number of observations in the data set, the median is the middle observation (n + 1)/2 of the data set. <span>If the number of observations is even, there is no single middle observation (there are two, actually). To find the median, take the arithmetic mean of the two middle observations. The median is less sensitive to extreme scores than the mean. This makes it a better measure than the mean for highly skewed distributions. Looking at median income is usua

#### Flashcard 1636623322380

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For highly skewed distributions what is a better measure of central tendency, the mean or the median?
the median because it is less sensitive to extreme scores than the mean.

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Subject 4. Measures of Center Tendency
he middle observation (n + 1)/2 of the data set. If the number of observations is even, there is no single middle observation (there are two, actually). To find the median, take the arithmetic mean of the two middle observations. <span>The median is less sensitive to extreme scores than the mean. This makes it a better measure than the mean for highly skewed distributions. Looking at median income is usually more informative than looking at mean income, for example. The sum of the absolute deviations of each number from the median is lower than the sum of

#### Flashcard 1636625681676

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Looking at [...] income is usually more informative than looking at [...] income
median

mean

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Subject 4. Measures of Center Tendency
, actually). To find the median, take the arithmetic mean of the two middle observations. The median is less sensitive to extreme scores than the mean. This makes it a better measure than the mean for highly skewed distributions. <span>Looking at median income is usually more informative than looking at mean income, for example. The sum of the absolute deviations of each number from the median is lower than the sum of absolute deviations from any other number. Note that whenever you c

#### Flashcard 1636632759564

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Mode is the [...] score in a distribution.
most frequently occurring

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Subject 4. Measures of Center Tendency
a median, it is imperative that you place the data in order first. It does not matter whether you order the data from smallest to largest or from largest to smallest, but it does matter that you order the data. Mode <span>Mode means fashion. The mode is the "most fashionable" number in a data set; it is the most frequently occurring score in a distribution and is used as a measure of central tendency. A set of data can have more than one mode, or even no mode. When all values are different, the data set has no mode. When a distribution has one value that appears most frequently, it i

#### Flashcard 1636635118860

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A set of data can have [...] mode, or even [...].
more than one

no mode

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Subject 4. Measures of Center Tendency
ou order the data. Mode Mode means fashion. The mode is the "most fashionable" number in a data set; it is the most frequently occurring score in a distribution and is used as a measure of central tendency. <span>A set of data can have more than one mode, or even no mode. When all values are different, the data set has no mode. When a distribution has one value that appears most frequently, it is said to be unimodal. A data set that has two modes is said

#### Flashcard 1636637478156

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When all values are different, the data doen's have a [...]
mode

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Subject 4. Measures of Center Tendency
fashion. The mode is the "most fashionable" number in a data set; it is the most frequently occurring score in a distribution and is used as a measure of central tendency. A set of data can have more than one mode, or even no mode. <span>When all values are different, the data set has no mode. When a distribution has one value that appears most frequently, it is said to be unimodal. A data set that has two modes is said to be bimodal. The advantage of the mode a

#### Flashcard 1636641410316

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Which is the only measure of central tendency that can be used with nominal data.
Mode

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Subject 4. Measures of Center Tendency
to be unimodal. A data set that has two modes is said to be bimodal. The advantage of the mode as a measure of central tendency is that its meaning is obvious. Like the median, the mode is not affected by extreme values. Further, <span>it is the only measure of central tendency that can be used with nominal data. The mode is greatly subject to sample fluctuations and, therefore, is not recommended for use as the only measure of central tendency. A further disadvantage of the mode is that many di

#### Flashcard 1636652420364

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Mode helps to identify [...] and [...] of distribution.
shape and skewness

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Subject 4. Measures of Center Tendency
ric distributions. The mean is higher than the median in positively skewed distributions and lower than the median in negatively skewed distributions. Extreme values affect the value of the mean, while the median is less affected by outliers. <span>Mode helps to identify shape and skewness of distribution.<span><body><html>

#### Flashcard 1636817308940

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In addition to permitting ranking and addition or subtraction, ratio scales allow [...].
computation of meaningful ratios

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In addition to permitting ranking and addition or subtraction, ratio scales allow computation of meaningful ratios.

#### Original toplevel document

Subject 2. Measurement Scales
s in temperature, but a temperature of 30°F is not twice as warm as one of 15°F. Ratio Scale Ratio scales are like interval scales except that they have true zero points. This is the strongest measurement scale. <span>In addition to permitting ranking and addition or subtraction, ratio scales allow computation of meaningful ratios. A good example is the Kelvin scale of temperature. This scale has an absolute zero. Thus, a temperature of 300°K is twice as high as a temperature of 150°K. Two financial examples of ra

#### Flashcard 1636819668236

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In a frequency distribution It is important to consider [...] to be used.
the number of intervals

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In a frequency distribution It is important to consider the number of intervals to be used. If too few intervals are used, too much data may be summarized and we may lose important characteristics; if too many intervals are used, we may not summarize enough.

#### Original toplevel document

Subject 3. Frequency Distributions
that: Each observation can only lie in one interval. The total number of intervals will incorporate the whole population. The range for an interval is unique. This means a value (observation) can only fall into one interval. <span>It is important to consider the number of intervals to be used. If too few intervals are used, too much data may be summarized and we may lose important characteristics; if too many intervals are used, we may not summarize enough. A frequency distribution is constructed by dividing the scores into intervals and counting the number of scores in each interval. The actual number of scores and the percent

#### Flashcard 1636834086156

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The classes in a frequency distribution must be [...] and [...]
mutually exclusive

of equal size.

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data into a frequency distribution together with suggestions on constructing the frequency distribution. Identify the highest and lowest values of the observations. Setup classes (groups into which data is divided). <span>The classes must be mutually exclusive and of equal size. Add up the number of observations and assign each observation to its class. Count the number of observations in each class. This is called the class freque

#### Original toplevel document

Subject 3. Frequency Distributions
by the total number of observations. Cumulative absolute frequency and cumulative relative frequency are the results from cumulating the absolute and relative frequencies as we move from the first to the last interval. <span>The following steps are required when organizing data into a frequency distribution together with suggestions on constructing the frequency distribution. Identify the highest and lowest values of the observations. Setup classes (groups into which data is divided). The classes must be mutually exclusive and of equal size. Add up the number of observations and assign each observation to its class. Count the number of observations in each class. This is called the class frequency. Data can be divided into two types: discrete and continuous. Discrete: The values in the data set can be counted. There are distinct spaces between the values, such as

#### Flashcard 1637167795468

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These values can be measured using sufficiently accurate tools to numerous decimal places.
Continuous data

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ts of decimal places involved and (theoretically, at least) there are no gaps between permissible values (i.e., all values can be included in the data set). Examples would include the height of a person and the time to complete an assignment. <span>These values can be measured using sufficiently accurate tools to numerous decimal places.<span><body><html>

#### Original toplevel document

Subject 3. Frequency Distributions
ed into two types: discrete and continuous. Discrete: The values in the data set can be counted. There are distinct spaces between the values, such as the number of children in a family or the number of shares comprising an index. <span>Continuous: The values in the data set can be measured. There are normally lots of decimal places involved and (theoretically, at least) there are no gaps between permissible values (i.e., all values can be included in the data set). Examples would include the height of a person and the time to complete an assignment. These values can be measured using sufficiently accurate tools to numerous decimal places. There are two methods that graphically represent continuous data: histograms and frequency polygons. 1. A histogram is a bar chart that displays a frequency distributi

#### Flashcard 1637170154764

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Examples [...] data would include the height of a person and the time to complete an assignment.
Continuous

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an>Continuous: The values in the data set can be measured. There are normally lots of decimal places involved and (theoretically, at least) there are no gaps between permissible values (i.e., all values can be included in the data set). Examples would include the height of a person and the time to complete an assignment. These values can be measured using sufficiently accurate tools to numerous decimal places.<span><body><html>

#### Original toplevel document

Subject 3. Frequency Distributions
ed into two types: discrete and continuous. Discrete: The values in the data set can be counted. There are distinct spaces between the values, such as the number of children in a family or the number of shares comprising an index. <span>Continuous: The values in the data set can be measured. There are normally lots of decimal places involved and (theoretically, at least) there are no gaps between permissible values (i.e., all values can be included in the data set). Examples would include the height of a person and the time to complete an assignment. These values can be measured using sufficiently accurate tools to numerous decimal places. There are two methods that graphically represent continuous data: histograms and frequency polygons. 1. A histogram is a bar chart that displays a frequency distributi

#### Flashcard 1637172514060

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[...] : The values in the data set can be measured.
Continuous

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Continuous: The values in the data set can be measured. There are normally lots of decimal places involved and (theoretically, at least) there are no gaps between permissible values (i.e., all values can be included in the data set). Example

#### Original toplevel document

Subject 3. Frequency Distributions
ed into two types: discrete and continuous. Discrete: The values in the data set can be counted. There are distinct spaces between the values, such as the number of children in a family or the number of shares comprising an index. <span>Continuous: The values in the data set can be measured. There are normally lots of decimal places involved and (theoretically, at least) there are no gaps between permissible values (i.e., all values can be included in the data set). Examples would include the height of a person and the time to complete an assignment. These values can be measured using sufficiently accurate tools to numerous decimal places. There are two methods that graphically represent continuous data: histograms and frequency polygons. 1. A histogram is a bar chart that displays a frequency distributi

#### Flashcard 1637607935244

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A class. is also called an [...]
interval

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Subject 3. Frequency Distributions
with individual numbers becomes laborious and messy. In such circumstances, it is neater and more convenient to summarize results into what is known as a frequency table. The data in the display is called a frequency distribution. <span>An interval, also called a class, is a set of values within which an observation falls. Each interval has a lower limit and an upper limit. Intervals must be all-inclusive and non-overlapping. A frequency distribution is a tabular display of data categor

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How do you calculate the range (Range = [...] )

(second step in frequency distribution)

Maximum value − Minimum value

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Frequency distribution steps
Construction of a Frequency Distribution. Sort (in ascending order) Calculate the range (Range = Maximum value − Minimum value) Intervals creation (decide the number you will put in the frequency distribution, k.) Width determination ( interval width = Range/k.) Ad

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Starting from small K to larger, what give you the cue there are too many?
if a lot of the intervals are mostly empty

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When choosing k we need to keep in mind that the purpose of a frequency distribution is to [...]
summarize the data.

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The arithmetic mean can be likened to [...]
the center of gravity of an object.

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How is the distance between the mean and each outcome called ?
deviation.

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Mathematically, it is always true that the sum of the deviations around the mean equals [...]
0

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Deviations from the arithmetic mean are important information because they indicate [...]
risk.

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The concept of [...] forms the foundation for the more complex concepts of variance, skewness, and kurtosis
deviations around the mean

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In an even-numbered sample, we define the median as the mean of the values of items occupying the [...] and [...] positions
n/2

(n + 2)/2

(the two middle items)

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What does it mean that the median is less mathematically tractable than the mean.
Calculating the median is more complex, order the observations from smallest to largest, determine whether the sample size is even or odd and, on that basis, apply one of two calculations

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Stock return data and other data from [...] distributions may not have a modal outcome
continuous

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The modal interval always has the [...] in the histogram.
highest bar

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In the arithmetic mean, all observations are equally weighted by the factor [...]
1/n (or 1/N)

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An average in which each observation is weighted by an index of its relative importance.
Weighted mean

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The weighted mean ¯¯¯Xw , for a set of observations X1, X2, …, Xn with corresponding weights of w1, w2, …, wn is computed as:

$$\bar{X}_w = \displaystyle\sum_{i=1}^n W_iX_i$$

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Market indexes are computed as [...]
weighted averages.

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When we take a weighted average of forward-looking data, the weighted mean is called [...]

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The probability-weighted average of the possible outcomes of a random variable.

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Geometric mean formula

G= [...]

G=n√X1X2X3…Xn

with Xi ≥ 0 for i=1,2,…,n

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A measure of central tendency computed by taking the nth root of the product of n non-negative values.
Geometric mean

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Se puede calcular la media geometrica si un valor es 0
si

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How do you solve the condition for geometric mean when there are negative returns?
You add 1 to every return (-100% is as low as it can get) and substract 1 at the end

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Because geometric mean returns use time series, we use a [...] in the RG
t indexing time as well

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RG = [...]
T√(1+R1)(1+R2)…(1+RT) -1

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Geometric mean returns are also referred to as [...]
compound returns.

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the geometric mean is always [...] to the arithmetic mean.
less than or equal

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The only time the two means (Geometric and Arithmetic) will be equal is when [...]
all the observations in the series are the same

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The difference between the arithmetic and geometric means increases with [...]
the variability in the period-by-period observations.

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A type of weighted mean computed by averaging the reciprocals of the observations, then taking the reciprocal of that average.
Harmonic Mean

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The harmonic mean may be viewed as a special type of weighted mean in which an observation’s weight is [...]
inversely proportional to its magnitude.

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The periodic investment of a fixed amount of money.
Cost averaging

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What is a good example on when to use the Harmonic Mean?
Cost Averaging (lo que hiciste con Javier)

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If talking about a Survey is it a population or a sample?
Sample

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When in a histograms there are only midpoints showing how do you find out the interval width?
substract any Midpoint - Midpoint-1 and you have the interval width.

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What is class mark in a Frequency distribution?
The average of the values of the class limits

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Given a set of observations, how many observations lie below the 33th percentile?
33%

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We know that the median divides a distribution in half. We can define other dividing lines that split the distribution into smaller sizes called [...]
Quantiles

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The value of Ly may or may not be a [...]

whole number.

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In general, as the sample size increases, the percentile location calculation becomes [...]

more accurate;

in small samples it may be quite approximate.​​​​​​​

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When the location, Ly, is a whole number, the location corresponds to [...]

an actual observation.

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When Ly is not a whole number or integer, Ly lies [...]

between the two closest integer numbers

(one above and one below)​​​​​​​

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When Ly is not a whole number or integer, Ly lies between the two closest integer numbers (one above and one below), and we use [...] between those two places to determine Py.

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The estimation of an unknown value on the basis of two known values that bracket it, using a straight line between the two known values.

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The mean tells us where returns are centered but, to completely understand an investment, we also need to know how returns are [...]
dispersed around the mean.

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[...] is the variability around the central tendency.

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The most common measures of dispersion: mean absolute deviation, [...], range and [...]
variance

standard deviation.

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The amount of variability present without comparison to any reference point or benchmark.
Absolute Dispersion

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The [...] or [...] of return is often used as a measure of risk pioneered by Nobel laureate Harry Markowitz.
variance

standard deviation

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The simplest of all the measures of dispersion is [...]
range

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Range can be computed with [...] or [...] data.
interval

ratio

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The difference between the maximum and minimum values in a dataset.
Range

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• Range = [...]

Maximum value – Minimum value

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how the data are distributed is called the [...]

shape of the distribution

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The interquartile range is a [...]
distance measure of dispersion

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Interquartile Range
Another distance measure of dispersion that we may encounter, the interquartile range, focuses on the middle rather than the extremes. The interquartile range (IQR) is the difference between the third and first quartiles o

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The interquartile range (IQR) is the difference between [...]
the third and first quartiles of a data set

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Interquartile Range
Another distance measure of dispersion that we may encounter, the interquartile range, focuses on the middle rather than the extremes. The interquartile range (IQR) is the difference between the third and first quartiles of a data set: IQR = Q 3 − Q 1 . The IQR represents the length of the interval containing the middle 50 percent of the data, with a larger interquartile range indicating greater dispersion, all else

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IQR = [...]
Q3Q1

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Interquartile Range
span>Another distance measure of dispersion that we may encounter, the interquartile range, focuses on the middle rather than the extremes. The interquartile range (IQR) is the difference between the third and first quartiles of a data set: <span>IQR = Q 3 − Q 1 . The IQR represents the length of the interval containing the middle 50 percent of the data, with a larger interquartile range indicating greater dispersion, all else equal.</sp

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The IQR represents the length of the interval containing [...] of the data,
the middle 50 percent

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Interquartile Range
ce measure of dispersion that we may encounter, the interquartile range, focuses on the middle rather than the extremes. The interquartile range (IQR) is the difference between the third and first quartiles of a data set: IQR = Q 3 − Q 1 . <span>The IQR represents the length of the interval containing the middle 50 percent of the data, with a larger interquartile range indicating greater dispersion, all else equal.<span><body><html>

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All else equal, a larger interquartile range indicaties [...]
greater dispersion.

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Interquartile Range
le rather than the extremes. The interquartile range (IQR) is the difference between the third and first quartiles of a data set: IQR = Q 3 − Q 1 . The IQR represents the length of the interval containing the middle 50 percent of the data, <span>with a larger interquartile range indicating greater dispersion, all else equal.<span><body><html>

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With reference to a sample, the mean of the absolute values of deviations from the sample mean.

Mean Absolute Deviation

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The mean absolute deviation formula

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Subject 6. Measures of Dispersion
artile range. Example The range of the numbers 1, 2, 4, 6,12,15,19, 26 = 26 - 1 = 25 Recall that the deviation from the arithmetic mean is the distance between the mean and an observation in the data set. <span>The mean absolute deviation (MAD) is the arithmetic average of the absolute deviations around the mean. In calculating the MAD, we ignore the signs of deviations around the mean. Remember that the sum of all the deviations from the mean is equal to

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The mean absolute deviation (MAD) is the [...] of [...]

arithmetic average

the absolute deviations around the mean.

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Subject 6. Measures of Dispersion
artile range. Example The range of the numbers 1, 2, 4, 6,12,15,19, 26 = 26 - 1 = 25 Recall that the deviation from the arithmetic mean is the distance between the mean and an observation in the data set. <span>The mean absolute deviation (MAD) is the arithmetic average of the absolute deviations around the mean. In calculating the MAD, we ignore the signs of deviations around the mean. Remember that the sum of all the deviations from the mean is equal to

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In calculating MAD, we ignore [...] of the deviations around the mean.

the signs

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One technical drawback of MAD is that it is difficult to manipulate mathematically compared with the [...] .

variance

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A second approach to the treatment of deviations adding up to 0 is to [...]

square them.

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The expected value of squared deviations from a random variable’s expected value.

Variance

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[...] is defined as the average of the squared deviations around the mean

Variance

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[...] is the positive square root of the variance.

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The positive square root of the variance; a measure of dispersion in the same units as the original data.