If X Helps to Predict Y,then the Standard Deviation of Y

question 12

Multiple Choice

If X helps to predict Y,then the standard deviation of Y _____.

• A)is larger than the standard error of estimate
• B)is smaller than the standard error of estimate
• C)will equal the standard error of estimate
• D)will be independent of the standard error of estimate

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Definitions:

Market Value

The going price for an asset or service in the open market at which it can be traded.

Equity-Financed

Funded through the sale of owner's shares, rather than borrowing or accumulating debt.

Synergy Value

The added value created by combining two companies where the performance of the combined entity is greater than the sum of the separate individual parts.

Acquisition

The process of taking control of another company by purchase or merger.