If Rain Dancing Is Correlated with Rain, Does That Necessarily

question 100

Multiple Choice

If rain dancing is correlated with rain, does that necessarily mean rain dancing causes rain?

• A) No. This is an example of the fallacy of composition.
• B) No. Two variables may be correlated without one necessarily causing the other.
• C) Yes. This is an example of a failure to properly employ the ceteris paribus assumption.
• D) Yes. If it rains after individuals have engaged in rain dancing, then there is certainly causation at work.

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Definitions:

Profit on Sale-Leaseback

This refers to the gain a company realizes when it sells an asset and immediately leases it back from the buyer, thus continuing to use the asset without owning it.

Amortization

A process of gradually writing off the initial cost of an asset over a period.

Interest Cost

Represents the total expense over the life of a borrowing, calculated as the difference between the amount borrowed and the amount repaid.