Two Variables Are Negatively Related If

question 163

Multiple Choice

Two variables are negatively related if

• A)increases in one are associated with decreases in the other.
• B)increases in one are associated with increases in the other.
• C)both variables are less than zero.
• D)any change in one causes an increase in the other.
• E)any change in one causes a decrease in the other.

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Definitions:

Equity Method

An accounting method used to record investments in associate companies where the investor has significant influence but not full control, typically 20%-50% ownership. The investor's share of the investee's net income or loss is reflected in the investor's financial statements.

Net Income

A company's profit after deducting expenses and taxes from revenue.

Dividends

Payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders.

Partial Equity Method

An accounting approach where an investor recognizes income from its investment in an associate to the extent of dividends received, differing from the full equity method which recognizes income as it's earned by the associate, regardless of dividends received.