Which of the Following Is Not True for Regression

question 22

Multiple Choice

Which of the following is not true for regression?

• A) It determines the direction of association.
• B) It determines the strength of association.
• C) It predicts value of one variable based on the value of another variable.
• D) It determines the variance in the direction of the relationship between three or more variables.

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Definitions:

Annual Coupon Bond

A bond that pays interest to the holder annually until its maturity, at which point the principal is repaid.

Real Rate

The interest rate that has been adjusted for inflation, reflecting the true cost of borrowing or real yield on an investment.

Inflation

The rate at which the comprehensive cost of goods and services inflates, sapping the buying power.

Total Percentage Return

The total return on an investment, including both capital gains and dividends, expressed as a percentage of the initial investment.