Volatility clustering
A)is evident in most cross-sections.
B)implies that a series is serially correlated.
C)can mostly be found in studies of the labor market.
D)is evident in many financial time series.

Question

Quizplus · Accepted Answer

Volatility clustering refers to the phenomenon where periods of high volatility are followed by additional periods of high volatility, and periods of low volatility are followed by additional periods of low volatility. This is a common feature of many financial time series, such as stock prices or exchange rates. Therefore, the best choice is D, "is evident in many financial time series."

Volatility Clustering