Variable X Is Correlated with Variable Y

question 21

Multiple Choice

Variable X is correlated with Variable Y. Which of the following could explain this correlation?

• A) X causes Y.
• B) Y causes X.
• C) A third variable causes or influences both X and Y.
• D) All of these are possible explanations.

---

Definitions:

Voting Shares

Voting shares are shares of stock in a company that grant the shareholder the right to vote on corporate matters, typically in proportion to the number of shares held.

Fair Value

The approximate financial worth of an asset or liability, determined by existing prices in a transparent and contestable market.

Fully Amortized

Pertains to a loan or mortgage that has been completely paid off, principal and interest, over its term.

Direct Combination Costs

Expenses directly associated with the execution of a business combination, such as legal fees, consulting fees, and other administrative costs.