IIBA Exam CBDA Topic 4 Question 18 Discussion

Actual exam question for IIBA's CBDA exam

Question #: 18
Topic #: 4

[All CBDA Questions]

An analyst at a bank is trying to identify research questions for an analytical study on top customer issues across branches. During an interview with a branch manager, the analyst asks the manager what their top customer concerns are relating to this branch?

After the manager's reply, the analyst asks a follow up question on how their top customer concerns compare against the top customer concerns across all branches? Was the analyst's follow-up question valid?

ANo, there is no value comparing the results of a single branch with results across all
branches

BYes, it builds on the previous question and allows the analyst to identify branch-specific
concerns

CNo, the question is not valid in this particular scenario

DYes, only for the purpose of ensuring that the manager is aware of the company-wide
reports

Show Suggested Answer

Suggested Answer: C

Covariance measures the directional relationship between the returns on two assets. A positive covariance means that asset returns move together while a negative covariance means they move inversely. Zero covariance indicates that the returns on the two assets move independently of each other. In the context of a scatter plot, zero covariance is represented by a plot where the points do not show any upward or downward trend but are rather scattered randomly on the graph with no discernible pattern.

Graph 4 displays such a pattern where there is no apparent relationship between the variables on the x and y axes, indicating that there is zero covariance between them.

by Frederic at Aug 05, 2024, 01:37 PM

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