Which Statement Is Not True About Cluster Analysis

question 15

Multiple Choice

Which statement is not true about cluster analysis?

• A) Groups or clusters are suggested by the data, not defined a priori.
• B) Cluster analysis is a technique for analyzing data when the criterion or dependent variable is categorical and the independent variables are interval in nature.
• C) Cluster analysis is also called classification analysis or numerical taxonomy.
• D) Objects in each cluster tend to be similar to each other and dissimilar to objects in the other clusters.

---

Definitions:

Common Stock

A type of equity security that represents ownership in a corporation, giving holders voting rights and a share in the company's profits through dividends.

Premium

An amount paid in addition to a standard price or rate, often for insurance or an enhanced level of service or coverage.

Interest Expense

The cost incurred by an entity for borrowed funds, recognized as a non-operating expense on the income statement.

Contractual Interest Rate

The agreed-upon rate of interest that is to be applied on the principal amount of loans, bonds, or other forms of debt as specified within a contract.