When Predicting a Student's GPA on the Basis of the Verbal

question 6

Multiple Choice

When predicting a student's GPA on the basis of the Verbal SAT score, the regression line was equal to .01X + .10. This means that there was

• A) a .01 increase in GPA for each point increase in SAT
• B) a .01 increase in SAT for each point increase in GPA
• C) an SAT value of .10 when the the GPA was equal to zero
• D) a and c, but not b

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Definitions:

Liquidity

The ease with which an asset can be converted into cash without significantly affecting its price, reflecting the ability of a company or individual to meet immediate and short-term obligations.

Precautionary Motive

The desire to hold cash or other liquid assets to meet unexpected needs and financial emergencies.

Financial Slack

The availability of excess funds or resources in a company that allows for flexibility in operations, strategic investments, or weathering financial uncertainties without immediate financial stress.

Keynes

Refers to John Maynard Keynes, a British economist whose ideas fundamentally changed the theory and practice of macroeconomics and economic policies of governments.