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In a study on roommate preference,people who had to choose which of three hypothetical candidates would be the best roommate made the BEST decision when:
Correlation
A statistical measure that indicates the extent to which two or more variables fluctuate together. A positive correlation indicates that variables move in the same direction, while a negative correlation indicates they move in opposite directions.
Risk-Free Rate
The hypothesized return on an investment that carries no risk, often linked with government bonds.
Minimum Required Return
The lowest acceptable return on an investment, considering the risk and the cost of capital.
Expected Return
The anticipated return on an investment, taking into account the probabilities of each potential outcome.
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