An R² close to 1

question 5

Multiple Choice

An R² close to 1

• A)does not happen with real data.
• B)indicates that almost all of the variation in the dependent variable is explained by the regression.
• C)does not explain variation as well as an R² that is above 2.
• D)means that the regression line does not fit the data very well.

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Definitions:

Credit Sales

Sales transactions where the buyer is allowed to pay the seller at a later date, typically extending credit to the customer.

Direct Method

A way to present the cash flow statement where actual cash flows from operating activities are disclosed, contrasting with the indirect method.

Statement of Cash Flows

A financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents.

Depreciation Expense

The allocated cost of a tangible asset over its useful life, reflecting wear and tear, obsolescence, or decline in value.