The Correlation Coefficients Between the Returns on a Broad Index

question 36

Multiple Choice

The correlation coefficients between the returns on a broad index of Canadian stocks and the returns on indices of the stocks of other industrialized countries are,in general,_________,while the correlation coefficients between the returns on various diversified portfolios of Canadian stocks are,in general,_________.

• A) less than 0,greater than 0
• B) greater than 0,less than 0
• C) less than 0.8,greater than 0.8
• D) greater than 0.8,less than 0.8
• E) less than 0,less than 0

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Definitions:

Invincibility Fable

A cognitive bias often observed in adolescents who believe they cannot be harmed by risky behaviors.

Deductive Reasoning

A reasoning method where a conclusion is drawn from the agreement of several premises, which are typically believed to be true.

Personal Fable

An aspect of adolescent egocentrism characterized by an adolescent’s belief that their thoughts, feelings, and experiences are unique, more wonderful, or more awful than anyone else’s.

Adolescent Egocentrism

A characteristic of teenage thinking leading to an increased self-consciousness, where adolescents believe they are the focus of everyone else's attention.