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July 30, 2015

Homework Help: Economics/Math

Posted by Susan on Saturday, December 5, 2009 at 6:39am.

1. Assume that q and z are two random variables that are perfectly positively correlated. q takes the value of 20 with probability 0.5 and the value of zero with probability 0.5, while z takes the value of 10 with probability 0.5 and the value of zero with probability 0.5. What is the covariance of q and z?

(A) 50.
(B) 100.
(C) 0.
(D) 1.
(E) There is not enough information to tell.

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