Suppose That the Correlation Coefficient Between X₁ and X₂ Is

question 67

Multiple Choice

Suppose that the correlation coefficient between X₁ and X₂ is equal to -1. This means that

• A) X₁ and X₂ are perfectly positively correlated
• B) X₁ and X₂ are perfectly negatively correlated
• C) X₁ and X₂ are weakly and positively correlated
• D) X₁ and X₂ are weakly and negatively correlated

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Definitions:

Total Assets

The combined value of all owned resources and property by an entity that has economic value.

Salvage Value

An asset’s projected terminal value after the end of its usefulness.

Straight-line Method

A method of depreciation that allocates an equal amount of the asset's cost to each year of its useful life.

Units-of-activity Method

A depreciation method that allocates an asset's cost based on its usage, activities, or units produced, rather than the passage of time.