If the Correlation Coefficient (R) = 1.00, Then

question 73

Multiple Choice

If the correlation coefficient (r) = 1.00, then

• A) the Y-intercept (b₀) must equal 0.
• B) the explained variation equals the unexplained variation.
• C) there is no unexplained variation.
• D) there is no explained variation.

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Definitions:

Dividend Payout Ratio

The proportion of earnings paid out as dividends to shareholders, typically expressed as a percentage of the company's earnings.

Return on Equity (ROE)

A financial ratio that measures the profitability of a company in relation to shareholders' equity.

Accounting Principles

The standardized guidelines and rules for financial reporting and accounting practices, ensuring transparency and consistency.

Equity Value

The total value of a company's shares of stock, representing the portion of the company's total value owned by its shareholders.