An Asset Had Annual Returns of 12, 18, 6, −9

question 72

Multiple Choice

An asset had annual returns of 12, 18, 6, −9, and 5 percent, respectively, for the last five years. What is the variance of these returns?

• A).00810
• B).01013
• C).01065
• D).02038
• E).04052

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Definitions:

Correlations

Statistical measures that describe the extent to which two variables change together, but not necessarily indicating causation.

Objective Test

An assessment tool designed to measure knowledge, skills, or abilities without subjective judgment.

Criterion-related Validity

The extent to which a measure is related to an outcome, where the validity is determined by comparing the measure against a known criterion or benchmark.

Construct Validity

The extent to which a test or instrument accurately measures the theoretical construct it is intended to assess.