Data Mining Can Be Used to Predict What Will Happen

question 11

True/False

Data mining can be used to predict what will happen in the future.

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Definitions:

Arbitrage

The practice of buying and selling equivalent assets in different markets to take advantage of a price difference.

Law of One Price

An economic theory that states that in efficient markets, identical goods must have only one price when prices are expressed in a common currency, absent any transaction costs and tariffs.

Treasury Bond

A long-term, interest-bearing security issued by the U.S. government.

STRIPPED Cash Flows

Cash flows that are separated from their financial instruments in order to be sold as individual securities.