I If the Coefficient of Correlation Is 0

question 72

Multiple Choice

i. If the coefficient of correlation is 0.70, what is the coefficient of determination?
ii. If the value of r is -0.88, what does this indicate about the dependent variable as the independent
Variable increases?
iii. If the correlation between sales and advertising is -0.7, what percent of the variation in sales can
Be attributed to advertising?

• A) 0.49; it decreases; 49%0.49.
• B) 0.49; it decreases; 0.7.
• C) 0.49; it increases; 0.49.
• D) 0.8367; it decreases; 0.7.
• E) 0.8367; it increases; 0.8367.

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Definitions:

Technical Analyst

A professional who evaluates securities by analyzing statistics generated by market activity, such as past prices and volume.

Fundamental Analyst

An individual who evaluates securities by attempting to measure their intrinsic value based on economic and financial factors.

Past Price Patterns

Historical price movements of securities used by traders and analysts in the technical analysis to predict future market behavior.

Dividend

A portion of a company's earnings distributed to its shareholders, typically in the form of cash or additional shares.