If There Is a Very Strong Correlation Between Two Variables

question 16

Multiple Choice

If there is a very strong correlation between two variables, then the coefficient of determination must be

• A) much larger than 1, if the correlation is positive.
• B) much smaller than -1, if the correlation is negative.
• C) equal to zero.
• D) closer or equal to 1.

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Definitions:

Produced Domestically

Goods or services that are manufactured or created within a country's borders.

Production Possibilities Frontier

A graphical representation that shows the maximum number of possible goods and services that a country can produce given its resources and technology.

Absolute Advantages

The capacity of a country or entity to produce a good or service more efficiently than others, using the same amount of resources or less.

Opportunity Cost

Neglecting the potential profits from various alternatives upon the decision of one.