Interpret a Confidence Interval for the Slope of a Regression

question 6

Multiple Choice

Interpret a confidence interval for the slope of a regression equation.
-A researcher decides to investigate his students' suspicions that longer essays receive
Better scores on the SAT exam. He gathers data on the length of essays (number of lines)
And the SAT scores received for a sample of students enrolled at his university. Based on
His regression results, the 95% confidence interval for the slope of the regression equation
Is -0.88 to 1.34. At α = 0.05, we can say

• A) There is a statistically significant association between length of essays and SAT score.
• B) The correlation between length of essays and SAT score is significant.
• C) The slope of the regression equation is significantly different from zero.
• D) The slope of the regression equation is not significantly different from zero.
• E) The relationship between length of essays and SAT scores is significant and negative.

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Definitions:

Discount Rate

The interest rate used in discounting future cash flows to present value, often reflecting the cost of capital or risk level.

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return, used in evaluating investment opportunities.

Internal Rate of Return

A financial metric used to evaluate the profitability of an investment, representing the interest rate at which the net present value of all the cash flows (both positive and negative) from a project or investment equal zero.

Required Rate of Return

The minimum annual percentage return a investor expects to achieve from an investment, considering the risk involved.