What Is an Advantage of the Correlation Coefficient Over the Covariance

question 109

Multiple Choice

What is an advantage of the correlation coefficient over the covariance?

• A) It falls between 0 and 1.
• B) It falls between -1 and 1.
• C) It is a unit-free measure, therefore making it easier to interpret.
• D) Both answers-that it falls between -1 and 1 and that it is a unit-free measure-are correct.

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Definitions:

Mirror Image Rule

A principle in contract law stating that an offer must be accepted exactly without modifications; any changes negate the original offer and create a counteroffer.

Modified

Changed or altered from its original form or condition.

Without Reserve

In an auction context, it refers to the selling of items without any minimum bid requirement, allowing the sale to the highest bidder regardless of the bid amount.

Auctioneer

A person authorized to conduct auctions, responsible for accepting bids and declaring goods sold.