If a Data Point Is Influential It…

question 14

Multiple Choice

If a data point is influential it…

• A)has a small residual.
• B)is guaranteed to be extreme in the vertical direction.
• C)is guaranteed to be extreme in the horizontal direction.
• D)will change the slope of the regression equation.
• E)none of these.

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Definitions:

Interest Rate

The cost of borrowing money, typically expressed as an annual percentage of the principal loan amount.

Marginal Efficiency

The expected profitability of investing in additional units of capital, influencing a firm's decision to invest based on future returns.

Net Investment

The total spending on new capital minus the depreciation on existing capital, indicating the growth of a company's or nation's capital stock.

Inventory Investment

The stock of goods or merchandise kept by a business with the intent to sell it for profit.