# Ummm...am I losing it? Q-Bank

Which of the following statements about covariance and correlation is least accurate? A) A zero covariance implies a zero correlation. B) There is no relation between the sign of the covariance and the correlation. C) A positive covariance is indicated by an upward sloping relation in the points on the scatter plot of the two variables. D) The covariance and correlation are always the same sign, positive or negative. Your answer: D was incorrect. The correct answer was B) There is no relation between the sign of the covariance and the correlation. The correlation is the ratio of the covariance to the product of the standard deviations of the two variables. Therefore, the covariance and the correlation have the same sign. --------------------------------------------------------------------------------

agree

Ouch, that was a gimmie, A) 0/std*std = 0 B) Cov can be either positive or negative, std can only be positive since the differences are squared which means sign of Cov = sign on Cor. C) True D) What I said for B.

So D is correct.

I agree with their answer. B is the right answer. correlation always has the same sign as covariance.

B is right. The question asks which is “least” accurate. B is not accurate since there “is” a relation and the wording for choice B says “is no”

I got this one wrong last night and was going to post it later. Glad I’m not the only one. I put D as well.

its poor wording

Its not poor wording. It is a slight change in wording that makes a big difference. Going by your username, there is a perfect example of this in Taleb’s Fooled by Randomness. I’ll try to find the quote if I can find my book.