A Least Squares Regression Line

question 130

Multiple Choice

A least squares regression line

• A) can be used to predict a value of y if the corresponding x value is given.
• B) implies a cause-and-effect relationship between x and y.
• C) can only be determined if a good linear relationship exists between x and y.
• D) ensures that the predictions of y outside the range of the values of x are valid.

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Definitions:

Externalities

Economic side effects or consequences of commercial activities that affect other parties without being reflected in costs.

Price Mechanism

The process through which prices rise and fall as a result of changes in supply and demand, determining the allocation of resources in a market economy.

Wage and Price Controls

Government-imposed restrictions on the levels at which wages and prices can be set, usually to control inflation.

Inflation

A general increase in prices and decrease in the purchasing value of money.