If the Covariance Between Stock a and Stock B Is

question 53

Multiple Choice

If the covariance between stock A and stock B is 100,the standard deviation of stock A is 10% and that of stock B is 20%,calculate the correlation coefficient between the two securities.

• A)-0.5
• B)+1.0
• C)+0.5
• D)0.0

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Definitions:

Precious Metals

Metals of high economic value, such as gold, silver, and platinum, often used for investment or as currency.

Price Level

The average of current prices across the entire spectrum of goods and services produced in the economy.

Government Spending

Government spending involves expenditures by government bodies on public services, infrastructure, defense, social welfare, and more, impacting the economy’s overall fiscal stance.

Resource Availability

This refers to the accessibility and abundance of natural, human, and capital resources which can be used for production.