Sean Barber Wants to Invest in a Stock That Is

question 16

Multiple Choice

Sean Barber wants to invest in a stock that is relatively safe,suitable for conservative investors,and less speculative than other stocks.What type of stock best fits Sean's requirements?

• A)midcap stock
• B)cyclical stock
• C)small-cap stock
• D)blue-chip stock
• E)growth stock

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Definitions:

Correlation

A statistical measure that describes the extent to which two variables change together, but not necessarily indicating causation.

Prediction Error

The difference between observed values and the values predicted by a model.

Intercept

In mathematics and statistics, the point at which a line or curve intersects a given axis on a graph.

Predicted Income

An estimate of future income based on variables such as education, occupation, and previous earnings.