Research Indicates That the Correlation Coefficient Between Successive Days' Stock

question 27

Multiple Choice

Research indicates that the correlation coefficient between successive days' stock price changes is:

• A) quite close to +1.
• B) quite close to
• C) quite close to zero.
• D) directly related to the stock's beta.

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Definitions:

Reformation

The process of correcting or modifying a contract to reflect the true intentions of the parties involved when the original agreement is in error.

Equitable Remedy

A remedy provided by courts in situations where legal remedies (like monetary damages) are inadequate or inappropriate, focusing on fairness.

Concurrent Condition

Conditions in a contract that must be met simultaneously by the involved parties for the agreement to be executed fully and legally.

Accord and Satisfaction

A legal settlement where a debtor offers something of value to a creditor, and the creditor accepts it as full repayment of the debt.