Why Is a Numeric Association Between 2 Variables, Not Necessarily

question 34

Essay

Why is a numeric association between 2 variables, not necessarily indicative of a cause-effect relationship between the variables? Explain with an example.

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Definitions:

Merchandise Inventory

Goods that a retail or wholesale company intends to sell to customers. The inventory account is adjusted based on purchases and sales.

Purchases Returns

Goods returned to the supplier from the buyer due to defects, inaccuracies in orders, or other reasons.

Sales Returns

Transactions where customers return previously purchased merchandise to the seller, resulting in a deduction from gross sales to arrive at net sales.

Purchases Returns

Goods returned by a buyer to the seller, often due to defects or dissatisfaction, resulting in a refund or credit.