Stock M and Stock N Have Had the Following Returns

question 86

Multiple Choice

Stock M and Stock N have had the following returns for the past three years: 12 percent, -10 percent, and 32 percent; and 15 percent, 6 percent, and 24 percent, respectively.Calculate the covariance between the two securities.(Ignore the correction for the loss of a degree of freedom set out in the text.)

• A)-99
• B)126
• C)+250
• D)-250

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Definitions:

Absolute Pitch

The ability to identify or reproduce a musical note without the need for a reference tone.

Intermediate-Frequency

A frequency range that lies between the high frequency and low frequency bands, often used in radio frequency applications.

High Frequencies

Sound waves that have a very short wavelength and are typically perceived as high-pitched sounds.

Place Principle

A theory in auditory perception that suggests different parts of the cochlea are activated by different frequencies of sound, contributing to the perception of pitch.