The Pearson Correlation Coefficient Between Two Continuous Variables Is a Potentially

question 80

Multiple Choice

The Pearson correlation coefficient between two continuous variables is a potentially misleading measure under what which of the following conditions?

• A) When outliers have a marked effect on the linear curve
• B) When the sample size is large
• C) When both variables involved are normally distributed
• D) All of these can make this measure misleading.

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The expense or cost of an item or service before any taxes are applied.

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows over a period of time, used in capital budgeting to assess profitability of investments.

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The actual cost of an investment or financing after taking into account the effects of taxation.

Cost of Equity

The theoretical compensation a company provides to its shareholders for the risk associated with investing their money.