A Multiple Regression Equation Includes 5 Independent Variables, and the Coefficient

question 144

Multiple Choice

A multiple regression equation includes 5 independent variables, and the coefficient of determination is 0.81. The percentage of the variation in y that is explained by the regression equation is:

• A) 81%
• B) 90%
• C) 86%
• D) 85%
• E) about 16%

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Definitions:

Economic Profits

Profits exceeding the opportunity costs of a company; considered an indicator of efficiency and entrepreneurship.

Average Total Cost

The total cost of production divided by the total quantity of goods produced, representing the cost per unit.

Average Variable Cost

The cost of labor and materials divided by the quantity of output produced, reflecting costs that change with the level of output.

Average Total Cost

The total cost of production divided by the quantity of output produced; it includes both fixed and variable costs.