The Degree to Which a Variable Measures What It Is

question 5

Multiple Choice

The degree to which a variable measures what it is supposed to measure in isolating a cause and effect relationship is known as:

• A) outcome stability.
• B) external validity.
• C) context reliability.
• D) internal validity.

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Definitions:

Correlation

A statistical measure indicating the extent to which two variables change together.

Indices

Benchmarks or measures that track the performance of a specific basket of stocks, bonds, or other investment vehicles.

Period

A span of time during which certain events or conditions exist or take place, often used in reference to financial reporting, investment intervals, or cycles.

Cross Hedging

The practice of hedging risk by using a contract that is correlated with, but not identical to, the actual underlying asset or liability.