The Variance of the Rates of Return Is 0

question 120

Multiple Choice

The variance of the rates of return is 0.25 for stock X and 0.01 for stock Y. The covariance between the returns of X and Y is −0.01. The correlation of the rates of return between X and Y is ________.

• A) −0.25
• B) −0.20
• C) 0.20
• D) 0.25

Acknowledge the role of Enlightenment thinkers in shaping 18th-century culture and art.

Assess the impact of the Industrial Revolution on the development of new artistic themes and patronage.

Comprehend how the production possibilities frontier (PPF) illustrates efficiency, trade-offs, and opportunity costs.

Identify the causes and implications of shifts and shapes in the production possibilities frontier.

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Definitions:

Market Shares

The percentage of an industry's total sales that is earned by a particular company over a specified time period.

Market Price

The current price at which an asset or service can be bought or sold in the marketplace.

Patent Rights

Legal rights granted to an inventor or assignee to exclusively make, use, or sell an invention for a certain period of time.

Barrier to Entry

Factors that make it difficult for new firms to enter an industry, including high startup costs, stringent regulations, and established brand loyalty.