In Using Regression to Predict an Individual's Performance on the Criterion

question 28

Multiple Choice

In using regression to predict an individual's performance on the criterion based on his or her score on the instrument, the prediction is least accurate when the correlation is:

• A)-1.00
• B)0.00
• C).50
• D)1.00

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Definitions:

Market Value

The price in the market at which assets or services can currently be exchanged.

Investment's Cost

The total amount of money spent to acquire an investment, including all charges and fees associated with the purchase.

Average Accounting Return Rule

A capital budgeting criterion that measures the profitability of an investment as the average net income divided by the average book value.

Profitability Index Rule

A capital budgeting technique used to decide whether to invest in a project, calculated as the present value of future cash flows divided by the initial investment cost.