What Is Homogeneity of Variance

question 2

Multiple Choice

What is homogeneity of variance?

• A) It is the assumption that we want to have similar amounts of variance in each of our conditions. When we have homogeneity of variance, then the variability in each of our conditions should be similar.
• B) It is the assumption that we do not want to have similar amounts of variance in each of our conditions. When we have homogeneity of variance, then the variability in each of our conditions should be different.
• C) It is the assumption that we want to have different amounts of variance in each of our conditions. When we have homogeneity of variance, then the variability in each of our conditions should be different.
• D) It is the theory that we want to have similar amounts of observations in each of our conditions. When we have homogeneity of variance, then the number of observations in each of our conditions should be similar.

---

Definitions:

Call Premium

The amount by which the price of a callable bond exceeds its par (or nominal) value or the amount paid for an option above its intrinsic value.

Time Spread

An options or futures strategy where a trader simultaneously buys and sells the same financial instrument with different expiration dates.

Exercise Price

The specified price at which the holder of an option can buy or sell the underlying asset.

Expiration Date

The date on which an option, future, or derivative contract becomes invalid and the right to exercise it ceases.