You Generate a Pearson's Correlation Coefficient to Assess Whether Shareholder

question 8

Multiple Choice

You generate a Pearson's correlation coefficient to assess whether shareholder value is correlated with the number of employees hired at law firms. Which of the following statement is not accurate when employing this test?

• A) It can be used to measure 'effect size'.
• B) It varies between -1 and +1.
• C) It cannot be used with binary variables (those taking on a value of 0 or 1).
• D) It can be used on ranked data.

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