Both _______________ Analyses Are Classified as Data Reduction Methods Because

question 60

Multiple Choice

Both _______________ analyses are classified as data reduction methods because they take a great deal of data and summarize them with a much smaller set of quantities.

• A) regression and factor
• B) factor and discriminant
• C) factor and cluster
• D) cluster and discriminant

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Definitions:

Covariances

A measure of the degree to which two variables move in relation to each other.

Mean-Variance Efficient

A portfolio construction strategy that aims to achieve the highest expected return for a given level of risk by optimizing the mix of investments.

Expected Returns

The anticipated return on an investment, based on historical averages or statistical analyses.

Variances

Statistical measures that represent the dispersion of data points in a data set relative to its mean, indicating how spread out the data is.