The Typical Correlation Between a Child's IQ Test Score and Their

question 68

Multiple Choice

The typical correlation between a child's IQ test score and their classroom grade is about ____.

• A) +.2
• B) +.4
• C) +.6
• D) +.8

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Definitions:

Equilibrium Risk Premium

The expected return on a risky asset over the risk-free rate that brings the supply and demand for the asset into balance.

Risk-free Rate

The interest rate at which an investor can invest in an absolutely risk-free security over a specified period.

Arbitrage Opportunity

A situation where a trader can profit from differences in price of the same or similar financial instruments on different markets or in different forms.

Risk-free Rate

The theoretical rate of return of an investment with no risk of financial loss, often represented by government bonds.