A Correlation Coefficient Shows That Alcohol Consumption and Driving Accidents

question 107

Multiple Choice

A correlation coefficient shows that alcohol consumption and driving accidents are indeed related. As a result, a researcher could predict _____________ if the direction of the relationship is known.

• A) the number of arrests a person has will go up or down based on the type of car an individual drives
• B) the number of driving accidents a person has will go up or down based on the number of alcoholic drinks consumed
• C) the number of arrests will increase the fewer drinks an individual consumes
• D) the number of driving accidents a person has will contribute to the number of days spent in jail

---

Definitions:

Unsystematic Risk

The hazard pertaining to an individual business or field, which can be reduced by diversifying assets.

Systematic Risk

A risk pervasive throughout the whole market or a specific segment of it, not reducible by investment diversification.

Inflation Adjusted Risk

Refers to the danger of losing purchasing power of an investment due to inflation outpacing the returns.