Answer to Question #315024 in Statistics and Probability for Seemu

Question

Monthly income of the families is continuous or discrete and explain with supporting your answer

Answer 1

In theoretical models, it can be defined as either. This is up to the creator of the model and will depend on the context of the model and the function money serves within the model.

In the real world, money could also be considered both discrete and continuous- you cannot have $ in your bank account so therefore in that sense, money is discrete. However in economic studies such as estimating wage returns to education, money is always treated as a continuous variable, and this works well for analysis.