A Statement Is Made About Correlation

question 80

Multiple Choice

A statement is made about correlation. State whether the correlation is positive or negative and whether the correlation ismost likely due to coincidence, a common underlying cause, or a direct cause.
-People with higher incomes tend to live longer than those with lower incomes.

• A)Positive correlation; common underlying cause
• B)Positive correlation; coincidence
• C)Negative correlation; common underlying cause
• D)Positive correlation; direct cause

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Definitions:

Total Return

The overall financial gain or loss on an investment, considering both capital gains and income such as interest or dividends.

Dividend

A portion of a company's earnings that is paid to shareholders, usually on a regular basis.

Nominal Rate

The officially declared or promoted rate of interest for a loan or investment, excluding the effects of compounding or any associated fees.

Loan

A borrowed sum of money that is expected to be paid back with interest.