If Two Events Are Perfectly Negatively Correlated, Then

question 109

Multiple Choice

If two events are perfectly negatively correlated, then

• A)diversification can reduce but not eliminate risk.
• B)diversification can eliminate risk.
• C)diversification has no impact on risk.
• D)diversification cuts risk in half.

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Definitions:

Positive Punishment

Adding an unfavorable outcome or event following an undesired behavior to decrease the likelihood of that behavior happening in the future.

Negative Punishment

The removal of a desirable stimulus following a behavior, intended to decrease the likelihood of that behavior occurring again.

Operant Conditioning

A method of learning that occurs through rewards and punishments for behavior, influencing the probability of behavior being repeated.

Classical Conditioning

A method of learning that happens when an environmental trigger is associated with a naturally existing stimulus, yielding a trained reaction.