Variable X Is Correlated with Variable Y

question 47

Multiple Choice

Variable X is correlated with Variable Y.Which of the following could explain this correlation?

• A)X causes Y.
• B)Y causes X.
• C)A third variable causes or influences both X and Y.
• D)All of the answers are correct.

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Definitions:

Bottom Line

A term referring to a company's net income, indicating the essential outcome of its financial activities over a specified period.

Time-series Analysis

A statistical technique that analyzes a series of data points, usually collected at consistent intervals, to identify trends, cycles, or seasonal variations.

Trend Income Statements

Financial statements that show the progression of key income statement figures over a series of periods, allowing for trend analysis.

Sales

The revenues earned from selling goods or services over a period of time.