Which of the Following Is a Definition of the Covariance

question 8

Multiple Choice

Which of the following is a definition of the covariance between X and Y?

• A) Correlation between X and Y times variance of X times variance of Y
• B) Variance of X times the variance of Y
• C) Correlation between X and Y divided by the product of the standard deviation of X and the standard deviation of Y
• D) Correlation between X and Y times standard deviation of X times standard deviation of Y

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Definitions:

Common Equity

The percentage of a corporation's equity held by investors in the form of common shares.

Weighted Average

A calculation that takes into account the varying degrees of importance of the numbers in a data set, giving more weight to some numbers than others.

Free Cash Flow

This refers to the amount of cash a company generates after accounting for cash outflows to support operations and maintain its capital assets. It is an important indicator of financial health.

Price Per Share

The current market value of a company's shares, determined by dividing the total market capitalization of the company by its number of outstanding shares.