Which One of the Following Correlation Coefficients Must Apply to Two

question 32

Multiple Choice

Which one of the following correlation coefficients must apply to two assets if the equally weighted portfolio of those assets creates a minimum variance portfolio that has a standard deviation of zero?

• A)−1.0
• B)−.5
• C)0
• D).5
• E)1.0

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Definitions:

Residual Volume

The amount of air remaining in the lungs after a forceful exhale, preventing lung collapse.

Vital Capacity

The maximum amount of air a person can expel from the lungs after a maximum inhalation, measuring lung health.

Vital Capacity

The maximum amount of air a person can expel from the lungs after a maximum inhalation, important in assessing respiratory health.

Molecular Oxygen

A diatomic molecule made up of two oxygen atoms, essential for processes such as respiration in aerobic organisms.