The Sample Correlation Coefficient Between X and Y Is 0

question 181

Multiple Choice

The sample correlation coefficient between X and Y is 0.375.It has been found out that the p-value is 0.256 when testing H₀: ρ = 0 against the two-sided alternative H₁: ρ ≠ 0.To test H₀: ρ = 0 against the one-sided alternative H₁: ρ < 0 at a significance level of 0.2,the p-value is

• A) 0.256 / 2.
• B) (0.256)2.
• C) 1 - 0.256.
• D) 1 - 0.256 / 2.

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Definitions:

Sensitivity Analysis

Sensitivity Analysis is a financial modeling tool used to determine how different values of an independent variable affect a particular dependent variable under a given set of assumptions.

Expected Value Analysis

A statistical technique used to predict the likely outcome of a decision or series of actions by considering all possible scenarios and their probabilities.

Capital Rationing

The act of placing restrictions on the amount of new investments or projects a company may undertake, often due to limited resources such as capital.

Present Value Concepts

The idea that an amount of money today is worth more than the same amount in the future due to its potential earning capacity, often calculated through discounting future cash flows.