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viktelen [127]
3 years ago
10

If markets are efficient, what should be the correlation coefficient between stock returns for two nonoverlapping time periods?

Business
1 answer:
S_A_V [24]3 years ago
7 0

Answer: Zero

Explanation:

The Correlation Coefficient measures the relationship between 2 variables under study and ranges from -1 to +1 which -1 meaning that the two are perfectly negatively correlated and +1 meaning they are perfectly positively correlation. A Correlation Coefficient of 0 means that there is no relationship.

An efficient market is one where all information is available to every market participant. This means that one cannot use information from one period to make abnormal profits in another period because all information is available. The Correlation Coefficient will therefore show 0 because information from the previous period is not being used in another period meaning there is no relationship between stock returns.

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amid [387]

Answer:

d. The higher the risk, the lower the possible investment.

Explanation:

With regards to speculation, hazard can be characterized as the changeability of return. the contrast between real result and expected result can be called as hazard. In the given model, Sandy think about that there is a positive connection between the likelihood of hazard and returns. for example on the off chance that there is high hazard, the likelihood of getting returns is high. in the event that there is less hazard, the likelihood of getting returns is low.  

Right now, likes to go with if the higher the hazard, the lower the potential ventures, in light of the fact that the inconstancy of profits is high. Means the financial specialist could conceivably get the profits, consequently they may like to go with certain and ensured returns than dubious more significant yields. In the region of ventures it is a typical inquiry to all, some may go with higher the hazard the lower the conceivable speculation.  

Henceforth, the appropriate response is option D.  

In the event that an announcement is there that the higher the hazard, the bigger the potential returns, it doesn't imply that the speculator gets more significant yields with his ventures. the odds are there to get more significant yields simultaneously there are a few issues moreover.

8 0
3 years ago
Explain global business planning system in detail
Orlov [11]

Explanation:

in global business obligation plan more ideas

8 0
2 years ago
Daniel has decided to open his own bakery using locally sourced ingredients and supplies. He provides income and jobs to local s
exis [7]

Answer: The invisible hand

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In the given case, Daniel is giving work to local suppliers and jobs to residents as well as producing demand in the market by its products, thus, we can conclude that the given case is an example of invisible hand.

5 0
3 years ago
Read 2 more answers
Which statement best describes the difference between a market and traditional economy
icang [17]

Answer:  in a traditional economy, decisions are based on habit and custom

Explanation:

4 0
10 months ago
Christine saw a television advertisement asking for donations of used vehicles to a charitable foundation and decided to donate
stealth61 [152]

Answer:

Option C She can claim an estimated value for the auto if the charity uses it rather than selling it

Explanation:

The reason is that the tax encourages you to make donations because the non for profit organization is doing the same thing which government does, they serve the people. So if the NGO is not selling the old car then the tax says that use the fair value of the asset as a amount donated to the charitable foundation. So the right answer here which includes the use of fair value is only Option C.

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2 years ago
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