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Body weight can be predicted based on the amount of calories consumed by an individual due to the positive correlation between the two variables.When looking at the line of best fit for the linear regression, the data points are clustered close together.Predicted shyness based on the number of friendships a person has is also correlated, but the data points are more scattered around the line of best fit, showing a general negative correlation.Which has the higher predictive power and why?
Reservation Price
The maximum price a buyer is willing to pay or the minimum price a seller is willing to accept for a good or service.
Utility Function
A mathematical representation of how different bundles of goods or services affect an individual's level of satisfaction or happiness.
Reservation Price
The maximum price a consumer is willing to pay for a good or service, beyond which they will not make a purchase.
Utility Function
A model that assigns numerical values to different bundles of goods, reflecting the satisfaction or utility these bundles provide to a consumer.
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