Which of the Following Statements Is True Regarding the Judgments

question 61

Multiple Choice

Which of the following statements is true regarding the judgments about correlation and causality bias?

• A)A correlation rules out other potential causes.
• B)A correlation between two variables is not evidence for causality.
• C)Temporal order indicates causality.
• D)An association between two variables is evidence for causality.

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Definitions:

Spot Rate

The current exchange rate at which a currency can be bought or sold for immediate delivery.

Settlement Date

The date on which a trade is finalized, and the buyer must make payment and the seller deliver the asset.

Fair Value Hedge

A type of hedge that aims to offset changes in the fair value of an asset or liability or an unrecognized firm commitment.

Forward Contract

An agreement to buy or sell an asset at a future date at a price agreed upon today, often used to hedge against price movements.