Which of the Following Pairs Is the Most Likely to Exhibit

question 148

Multiple Choice

Which of the following pairs is the most likely to exhibit an inverse relationship?

• A) The amount of time you study and your grade point average.
• B) People's annual income and their expenditure on personal computers.
• C) Baseball players' salaries and their batting averages.
• D) The price of a concert and the number of tickets people purchase.

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Definitions:

Profit Margin

A financial metric that measures the extent to which a company or a business activity makes money, expressed as a percentage of sales revenues.

Debt-Equity Ratio

The ratio that evaluates the equity-versus-debt financing approach for company assets.

Return on Equity

A measure of financial performance calculated by dividing net income by shareholder's equity, indicating how well a company uses investments to generate earnings growth.