The Correlation Between Two Returns

question 10

Multiple Choice

The correlation between two returns:

• A)is the covariance between the two returns divided by the product of their standard deviations.
• B)is the standard deviations of the two returns divided by the covariance between them.
• C)is the standard deviations of the two returns multiplied by the covariance between them.
• D)is the covariance between the two returns divided by the product of their variances.

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Definitions:

Gifted

The 2 percent of the population falling on the upper end of the normal curve and typically possessing an IQ of 130 or above.

The Bell Curve

A book that argues intelligence is a significant predictor of personal outcomes and that there are racial differences in intelligence that shape social status.

Socioeconomic Classes

Categories of individuals based on their economic status, often determined by factors such as income, wealth, education, and occupation.

Identical Twins

Twins who develop from a single fertilized egg that splits, resulting in two individuals with identical genetic make-up.