Shown Below Is a Correlation Table Showing Correlation Coefficients Between

question 16

Multiple Choice

Shown below is a correlation table showing correlation coefficients between stock price, earnings per share (EPS) and price/earnings (P/E) ratio for a sample of 19 publicly traded companies.Which of the following statements is false?
Correlations: Stock Price, EPS, PE

• A)EPS is the best predictor of stock price.
• B)The strongest correlation is between EPS and stock price.
• C)There is a weak negative association between PE and EPS.
• D)PE is the best predictor of stock price.
• E)The weakest correlation is between PE and EPS.

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Definitions:

Trait Theorists

Psychologists who study personality, focusing on identifying and measuring individual traits or characteristics.

Cluster

A collection or grouping of similar items, individuals, or events closely located or occurring together.

Dimension

A measurable extent of some kind, such as length, width, depth, or height, or an aspect or feature of a situation.

Selective Breeding

The process of breeding plants and animals for particular genetic traits, aiming to produce offspring with desired characteristics.