Calculation of the Standard Deviation of a Currency Addresses the Potential

question 19

Multiple Choice

Calculation of the standard deviation of a currency addresses the potential differences in results for high-value and low-value currencies by:

• A)averaging the exchange rates of the currency over a specific period of time.
• B)discounting the standard deviation of high-value currency.
• C)converting currency values into currency returns,which are percentage changes in currency values.
• D)adjusting the standard deviation of both currencies when comparing high- and low-value currencies.

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Definitions:

Rational Decision Maker

An individual or entity that makes decisions by systematically considering the available information, alternatives, and potential outcomes.

Economic Theory

A set of principles and methodologies that economists use to understand, explain, and make predictions about economic processes and behaviors.

Economist's Main Professional Objective

The primary goal of economists is to understand how economies operate and to develop strategies or policies to improve economic welfare and efficiency.

Average Behavior

the typical or mean actions or reactions of a group or individual, serving as a standard or norm for comparing specific behaviors.