Assuming a Linear Relationship Between X and Y,if the Coefficient

question 7

Multiple Choice

Assuming a linear relationship between X and Y,if the coefficient of correlation (r) equals -0.75,this means that:

• A) there is very weak correlation.
• B) the slope b₁ is = -0.75.
• C) the value of X is always greater than the value of Y.
• D) None of these choices are true.

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Definitions:

Cash Flows

refers to the in and out movement of cash and cash equivalents within a business.

Historical Rates

Exchange rates that were in effect at the time of a past transaction or financial statement, used for translating foreign currency transactions and balances into the reporting currency.

Foreign Operations

Business activities that are conducted in countries other than the company’s home country, often involving different currencies and regulations.

Natural Hedge

A risk management strategy that involves offsetting risk by naturally balancing opposing positions in the business.