Index Funds, Which Replicate the Movements of a Stock Exchange

question 111

Multiple Choice

Index funds, which replicate the movements of a stock exchange rather than trying to beat the market, follow:

• A) fundamental analysis.
• B) technical analysis.
• C) the efficient market hypothesis.
• D) present value analysis.

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Definitions:

Negative Linear Relationship

A direct relationship between two variables where an increase in one variable leads to a decrease in another.

Positive Linear Relationship

A relationship between two variables where an increase in one variable is associated with an increase in the other variable, depicted as a straight line.

No Relationship

A situation where two variables do not display any association, correlation, or cause-and-effect interaction with each other.

Independent Variable

The variable in an experiment that is manipulated by the researcher to examine its effect on the dependent variable.