Which of the Following Statements Identifies a Difference Between Correlation

question 80

Multiple Choice

Which of the following statements identifies a difference between correlation and causation?

• A) Correlation occurs when one thing directly affects another, whereas causation implies a mutual relationship between two things.
• B) Correlation implies a mutual relationship between two things, whereas causation occurs when one thing directly affects another.
• C) A causal relationship exists between two variables when they are correlated, but correlation does not necessarily exist if there's a causal relationship between two variables.
• D) Causation cannot arise when correlation is present, and correlation cannot arise when causation is present.

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Definitions:

Assets and Liabilities

Balance sheet components where assets are resources owned by a business, and liabilities are its financial obligations.

Holding Company

A corporation that owns enough voting stock in another company to control its policy and management.

Shares Exchange

The process of trading shares of stock between buyers and sellers on financial markets.

Directors and Shareholders

Individuals or entities that hold decision-making power (directors) and those who own shares in a company (shareholders).