When a Correlation Is Not Statistically Different from Zero

question 83

Multiple Choice

When a correlation is not statistically different from zero:

• A)a clear relationship exists between the two measures of interest, but the values move in opposite directions
• B)knowing the value of one measure does not allow you to predict the value of the second measure with an accuracy greater than chance
• C)high values on one measure will generally be associated with low values on the second measure
• D)low values on one measure will generally be associated with low values on the second measure

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Definitions:

Premium on Stock

The amount by which the price paid for a stock exceeds its par (or nominal) value, representing additional capital paid in by investors.

Treasury Stock

Stocks that the issuing entity initially sold and then bought back, decreasing the total number of stocks available in the market.

Contra Equity

An equity account that reduces the total amount of equity, such as treasury stock or drawings account.

Asset Account

An asset account is a ledger account that tracks the value of assets owned by an individual or organization, including tangible and intangible items of value.