Use the Information for the Question(s)below

question 32

Multiple Choice

Use the information for the question(s) below.
Suppose you invest $20,000 by purchasing 200 shares of Abbott Labs (ABT) at $50 per share,200 shares of Lowes (LOW) at $30 per share,and 100 shares of Ball Corporation (BLL) at $40 per share.
-Which of the following statements is FALSE?

• A)If two stocks move in opposite directions,one will tend to be above average when to other is below average,and the covariance will be negative.
• B)The correlation between two stocks has the same sign as their covariance,so it has a similar interpretation.
• C)The covariance of a stock with itself is simply its variance.
• D)The covariance allows us to gauge the strength of the relationship between stocks.

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Definitions:

Second Stage

In various contexts, it could refer to a subsequent phase of a process, such as the second part of childbirth when the baby is delivered.

Cesarean Births

A surgical procedure used to deliver a baby through incisions in the mother's abdomen and uterus.

United States

A country in North America made up of 50 states and a federal district, known for its significant influence on global economics, politics, and culture.

Medications

Substances used to diagnose, treat, or prevent illness and disease, affecting the body's structure or functions.