Consider the Characteristics of the Following Three Stocks The Correlation Between Thumb Devices and Air Comfort Is -0

question 34

Multiple Choice

Consider the characteristics of the following three stocks: $$\begin{array} { l l l } \hline & \begin{array} { l } \text { Expected } \\\text { Return }\end{array} & \begin{array} { l } \text { Standard } \\\text { Deviation }\end{array} \\\hline \begin{array} { l } \text { Thumb } \\\text { Devices }\end{array} & 13 \% & 23 \% \\\text { Air Comfort } & 10 \% & 19 \% \\\text { Sport Garb } & 10 \% & 17 \% \\\hline\end{array}$$ The correlation between Thumb Devices and Air Comfort is -0.12. The correlation between Thumb Devices and Sport Garb is 0.89. The correlation between Air Comfort and Sport Garb is -0.85. If you can pick only two stocks for your portfolio, which would you pick? Why?

• A)Combine Thumb Devices and Sport Garb because they have a high correlation.
• B)Combine Thumb Devices and Air Comfort because of high standard deviations.
• C)Combine Air Comfort and Sport Garb due to negative correlation.
• D)Combine Thumb Devices and Sport Garb because Thumb Devices has the highest return and Sport Garb has the lowest standard deviation.

Acknowledge the steps involved in implementing a compensation system.

Comprehend the importance and components of a compensation budget.

Recognize the importance of evaluating employee attitudes towards new compensation systems.

Evaluate the effectiveness of compensation systems through various metrics.

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