-A Risky Security Has a Variance of 0

question 101

Multiple Choice

$\begin{array}{c}\begin{array}{c}\underline{\text { Year }} \\1 \\2 \\3 \\4\end{array}\begin{array}{c}\underline{\text {Stock X}}\\-27 \% \\6 \% \\34 \%\\11\%\end{array}\begin{array}{c}\underline{\text { Market } }\\-7 \% \\11 \% \\18 \% \\10\%\end{array}\end{array}$

-A risky security has a variance of 0.034596 and a covariance with the market of 0.0216. The variance of the market is 0.023716. What is the correlation of this risky security to the market?

• A) 0.47
• B) 0.96
• C) 0.75
• D) 0.37
• E) 0.58

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Definitions:

Taxa

Taxa are the groups or categories used in the scientific classification of organisms, organized in a hierarchical system from kingdom down to species.

Inclusive

Embracing diversity and ensuring all individuals or elements are considered and integrated into a whole.

Five Kingdom Classification

A system that categorizes all living organisms into five distinct groups: Monera, Protista, Fungi, Plantae, and Animalia, based on their cell structure and function.

R. H. Whittaker

A prominent ecologist who proposed a five-kingdom classification system for living organisms based on cellular structure and mode of nutrition.