If Cov(x,y)= 20, Then the Sample Coefficient of Correlation

question 257

Multiple Choice

If cov(x,y) = 20, then the sample coefficient of correlation r is:

• A)1.400
• B)0.026
• C)0.714
• D)None of these choices.

---

Definitions:

Forward Contract

A financial derivative contract between two parties to buy or sell an asset at a specified future date for a price agreed upon today.

Canadian Dollars

The currency of Canada, represented by the symbol CAD or C$.

Foreign Exchange Risk

The possibility of losing value due to changes in currency exchange rates.

Spot Rate

The current market price at which a particular asset, such as foreign currency, can be bought or sold for immediate delivery.