The Sample Correlation Coefficient Between X and Y Is 0

question 35

Multiple Choice

The sample correlation coefficient between X and Y is 0.375. It has been found out that the p-value is 0.256 when testing H₀: ρ = 0 against the two-sided alternative H₁: ρ ≠ 0. To test H₀: ρ = 0 against the one-sided alternative H₁: ρ < 0 at a significance level of 0.1, the p-value is

• A) ₀.₂₅₆/₂.
• B) ₍₀.₂₅₆₎².
• C) ₁ ₋ ₀.₂₅₆.
• D) ₁ ₋ ₀.₂₅₆/₂.

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Definitions:

Net Present Value

A financial metric that calculates the value of a project or investment in today's dollars by discounting future cash flows to the present.

Security Market Line

A graphical representation in the Capital Asset Pricing Model (CAPM) that displays the expected return of an investment as a function of its beta, or systematic risk.

Risky Projects

Initiatives or investments that carry a high level of uncertainty or likelihood of not achieving the expected financial returns.

Weighted Average

A calculation that takes into account the varying degrees of importance of the numbers in a data set, providing a measure that reflects the relative significance of each number.