THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING:
Suppose X and Y are two random variables with E(X)= 1.50,E(Y)= 0.55,E(XY)= 0.80,Var(X)= 0.25,and Var(Y)= 0.2475.
-What is the value of Corr(X,Y)?
A)6.533
B)-0.1005
C)3.0151
D)-0.6356

Question

Quizplus · Accepted Answer

The correlation coefficient, Corr(X,Y), is calculated using the formula: Corr(X,Y) = [E(XY) - E(X)E(Y)] / sqrt(Var(X)Var(Y)). Substituting the given values, we get Corr(X,Y) = [0.80 - (1.50*0.55)] / sqrt(0.25*0.2475) = -0.1005.