A Study of Consumer Behavior Finds a Strong Positive Association

question 11

Multiple Choice

A study of consumer behavior finds a strong positive association between sales of ice cream and sales of soda.Describe three different possible cause-and-effect relationships that might be present.

• A)Perhaps sales of ice cream cause higher sales of soda,sales of soda cause higher sales of ice cream,or both could be caused by a lurking variable such as the outdoor temperature.
• B)There is only one cause-and-effect relationship: sales of soda cause higher sales of ice cream.
• C)There are no possible cause-and-effect relationship ,because there should be an arithmetic mistake.
• D)There is only one cause-and-effect relationship: sales of ice cream cause higher sales of soda.
• E)There are only two cause-and-effect relationships: sales of ice cream cause higher sales of soda,or sales of soda cause higher sales of ice cream.

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Definitions:

Inventory

A company's stock of goods or materials, which are held for the purpose of resale or in the production process.

Loan

A sum of money that is borrowed, which must be paid back with interest.

Cash Flows

The total amount of money being transferred into and out of a business, affecting the organization's liquidity, financial health, and operational capabilities.

Marketable Securities

Financial assets that can be quickly converted into cash at a known price.