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Aggregation Reduces the Standard Deviation of Demand

Question 56

Multiple Choice

Aggregation reduces the standard deviation of demand


A) only if demand across the regions being aggregated is perfectly positively correlated.
B) only if demand across the regions being aggregated is not perfectly positively correlated.
C) even if demand across the regions being aggregated is not perfectly positively correlated.
D) whenever demand across the regions being aggregated is not perfectly positively correlated.

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