Which distribution is characterized by an elongated tail to the right?

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Prepare for the CAIA Level I Exam with comprehensive questions and detailed explanations. Study strategically with customized quizzes tailored to each topic.

The distribution characterized by an elongated tail to the right is known as a positively skewed distribution. In this type of distribution, the bulk of the data points are concentrated on the left side, with a long tail extending to the right. This indicates that while most observations are lower in value, there are a few higher-value observations that pull the mean towards the right, resulting in an asymmetric distribution.

Positive skewness is often seen in data sets where extreme values can result from factors such as outliers or data that is constrained on the left (for example, income levels where most people earn below a certain amount, but a few earn significantly more). Understanding a positively skewed distribution is essential for analyzing data properly, as it affects measures such as the mean and median, which can give different representations of the central tendency.

In contrast, the other distributions mentioned, such as mesokurtic, leptokurtic, and platykurtic, describe various properties related to the "peakedness" and tail behavior of a distribution rather than specifically addressing the direction of the tail.

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